Chancellor Olaf Scholz's three-way coalition government is divided over how to turn the tide. / Photo: Reuters
"Although a recovery is likely to set in from the spring, the overall momentum will not be too strong," he added. Energy-intensive businesses in particular have been hit hard by soaring energy prices following Russia's war in Ukraine, contributing to a manufacturing slump in Europe's industrial powerhouse.
Habeck is in favour of relaxing the debt rules, but Finance Minister Christian Lindner of the FDP is strongly opposed.
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