The German economy has been losing momentum in recent months, according to a raft of fresh data, resulting in renewed calls for action to help spur growth in the struggling eurozone.
Italian Finance Minister Pier Carlo Padoan has already expressed his concern.
“Of course, if such a large economy in Europe loses a bit of steam, this is a source of concern for the economy but also for the rest of Europe,” says Padoan.
Italy, which this month took over the European Union’s six-month rotating presidency, has been spearheading efforts to boost the eurozone’s economic fortunes in part by making the EU’s budget rules more flexible.
Padoan’s comments follow a slew of downbeat German economic numbers with data released this month showing bigger-than-forecast falls in both German exports and imports in May.
“We are slowly in Europe exiting the Great Recession, but we are doing that at a slow speed, in an uneven pattern, and, therefore, we need to reinforce our growth efforts,” Padoan said in Brussels after chairing a meeting of EU finance ministers recently.
Padoan said this was the key reason behind the Italian presidency’s proposals for promoting more integration in Europe as well as more investment and more structural reforms as a way of boosting economic growth.
The batch of weak German economic figures came against the backdrop of a slowdown in emerging economies - notably China - as well as the economic fallout from the battle over Ukraine.
The euro’s recent rise together with subdued domestic demand in Germany has also served to undercut the nation’s economic performance.
The chief of the European plane maker Airbus, Fabrice Bregier, has added his name to the growing list of political and business leaders calling for action to take the sting out of what he says is the “crazy” level of the euro to help stimulate the eurozone economy.
“It is not fate that the euro shoots through the roof while the American and Japanese use their currencies to support industry,” he has said.
Last week’s German data pointing to a sharp contraction in trade followed the release of figures showing industrial production and factory orders also falling in May and unemployment unexpectedly rising for the second-consecutive month in June.
At the same time, the mood among business leaders and investors darkened last month with the ZEW investor sentiment survey falling for a sixth month in June.
Germany’s central bank, the Bundesbank, has already warned that the nation could face slowing growth during the current quarter after unusually mild winter weather helped the country post a solid 0.8% expansion during the first three months of 2014.