Explainer: Why is Germany's economy struggling in 2024?
diesel subsidies and train drivers planning several days of strikes over wage disputes.
The economy, Europe's biggest, was the weakest among its large euro zone peers last year, as high energy costs, feeble global orders and record-high interest rates took their toll.
The government then suffered a huge blow in November when Germany's top court threw out its 2024 budget plans, forcing divisive political wrangling over how to fill a 17 billion euro ($18.6 billion) funding gap.
Long-term structural problems surrounding Germany's workforce and infrastructure also remain unresolved.
The International Monetary Fund predicts Germany will be the only G7 economy that shrank in 2023 and at 0.9%, growth is expected to remain well below the average of 1.4% for advanced economies in 2024.
Here are some of the challenges facing Germany's economy in 2024:
PROTESTS
Chancellor Olaf Scholz's coalition has watered down proposals in its hastily reworked budget to cut diesel subsidies. However, the president of the German Farmers' Association said this did not go far enough and kept plans for nationwide rallies this week.
The Christmas truce declared by the GDL train drivers' union also ended on Monday. GDL plans a strike that would last several days as a wage dispute with rail operator Deutsche Bahn continues.
Deutsche Bahn presented a new offer on Friday which it hopes will resolve the dispute, but it is also seeking an injunction to stop the industrial action. GDL is studying the new proposal.
BUDGET TURMOIL
Scholz's three-party coalition announced an agreement on the key points of the draft budget for 2024 in December following weeks of negotiations after the
