Low water on Germany's Rhine River threatens new blow to economy
Dwindling water levels on some of Germany's major rivers, worsened by heat and drought, are raising fears that badly constrained riverboat cargo traffic could deal yet another blow to the struggling economy.
Germany's Rhine River is experiencing dangerously low water levels due to heat and drought, potentially inflicting further damage to the already struggling economy. The river, which transports 80% of Germany's inland cargo, has seen its cargo capacity severely limited. Steelmaker Thyssenkrupp and chemical company BASF have reported reduced vessel loading capacities, prompting shifts to smaller vessels, rail, and road transport.
Prices for shipping petroleum products have spiked, with rates reaching 200 euros per tonne. German Transport Minister Steffen Bilger met with industry leaders to address the crisis, considering measures such as lifting a ban on truck traffic on Sundays to alleviate the burden. However, road and rail transport face their own challenges, including high costs and limited capacity.
The economic impact of the dry spell could be significant, with ING economist Carsten Brzeski warning that the current drought may shave off 0.3 percentage points of German growth, potentially exacerbating the country's economic recovery challenges.
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