What is the projected impact of an April Russian energy ban on Germany?

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An April Russian Energy Ban Would Cause a Sharp Recession in Germany

An immediate cessation of Russian energy imports, specifically by mid-April, would result in Germany entering a sharp recession in the following year, 2023. This ban would limit economic growth to 1.9 per cent for 2022 and subsequently cause the German economy to contract by 2.2 per cent in 2023. The economic institutes forecasting this scenario indicate that the repercussions of such a boycott would persist for at least two years, with a potential setback extending into late 2023 or early 2024 before a gradual return to growth.
Projected Economic Contraction

A ban implemented in mid-April would significantly curtail Germany's economic expansion for 2022, reducing it to 1.9 per cent. The subsequent year, 2023, is projected to witness a contraction of 2.2 per cent, signifying a recession. This economic downturn is expected to be substantial, with the full impact of the boycott not being overcome within the subsequent two-year period.
Long-Term Economic Setback

Beyond the immediate recessionary period, Germany's economy could face further challenges. A potential setback is anticipated towards the end of 2023 and into the beginning of 2024, coinciding with increased energy demand during the European winter. Following this period, a gradual return to economic growth is foreseen.
Broader Economic Slowdown

Even without an explicit boycott of Russian gas, the ongoing conflict in Ukraine is already exerting a dampening effect on Germany's economic recovery from the COVID-19 pandemic. The leading economic institutes have consequently lowered their growth forecast for 2022 to 2.7 per cent, a significant reduction from the 4.8 per cent predicted in October of the previous year.
Impact on Energy Imports

Prior to the conflict in Ukraine, Russia was a crucial supplier for Germany's energy needs, accounting for one-third of oil imports, 45 per cent of coal purchases, and 55 per cent of gas imports. In response to the geopolitical situation, Germany has been actively working to reduce its reliance on Russian energy, accelerating investments in renewable energy sources and the development of liquefied natural gas (LNG) terminals to diversify its supply chain.

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What is the projected impact of an April Russian energy ban on Germany?

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