Germany faces a looming threat of deindustrialisation

Crunch time for a business model built on Russian gas and Chinese demand

Germany’s bakeries are feeling the burn of heating energy prices. In the land of more than 3,000 types of bread, around 10,000 bread producers are struggling. PHOTO: REUTERS
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In a book from 1945 entitled Germany Is Our Problem, Mr Henry Morgenthau, then America's Treasury Secretary, presented a proposal to strip post-war Germany of its industry and turn it into an agricultural economy. Though his radical proposal had some influence on Allied plans for the occupation of Germany after Hitler's defeat, it was never implemented.

Almost 80 years later, Russian leader Vladimir Putin might achieve some of what Mr Morgenthau, whose parents were both born in Germany, had in mind. By weaponising the natural gas on which Germany's mighty industrial base relies, the president is eating away at the world's fourth biggest economy and its third biggest exporter of goods.

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