Economist GMAT Reading Comprehension Challenge #19

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Article: It is time to worry about Germany’s economy

Link: https://www.economist.com/leaders/2019/02/07/it-is-time-to-worry-about-germanys-economy

The world… across the West

The world is used to a thriving German economy which has been an anchor of fiscal stability.

Yet the German economy…European champions.

Having narrowly avoided recession in 2018 and facing a slow-down, the German economy looks vulnerable.

Germany is getting both… too low by Germany.

Germany is getting the short and long term economic issues wrong by focusing on a potentially overheating economy and rising inflation instead of a low growth trap.

The slowdown…around the world.

The trade war with China and the drive to bring supply chains home could threaten Germany’s globalized economic model.

Reform has made…Germany will struggle.

Reform has made the German labour market strong but it may struggle to adapt to technological change.

The government is not blind…It is time to worry.

Increased infrastructure spending, tax incentives for private investment, and lower taxes for households to increase consumption would work better to keep the economy healthy than protectionism and the rolling back of labour market reforms.

Main Idea

The German economy has short and long term issues that could be solved by increasing infrastructure spending, tax incentives for private investment, and competition in coddled service industries while lowering taxes for households to increase consumption.

Primary Purpose

To discuss the issues facing the German economy and suggest ways to solve those issues.