German financial WARNING for EU: Merkel’s economy could CRASH because of rapid expansion

Experts and businessmen in Berlin sent the warning shot to the economic powerhouse even though its economy grew by 2.2 per cent last year – the highest since 2011. 

The impressive growth has triggered a rising demand for skilled workers and Germany’s biggest industry supplies including plastics, timber, food, chemicals and building materials – which are hard to find. 

German businessman Ralf Schlesselmann, who runs a wooden-pallet making business, said the country’s boom will not last forever. 

He warned the current situation reminds him of 2008, saying “and we all know what happened next” as he referred to the financial crisis. 

Mr Schlesselmann added: “For that reason, we’re a bit cautious as to how sustainable the boom really is.” 

His family business, Schlesselmann GmbH’s order book is fully booked, which means it has stopped taking on new customers. 

Mr Schlesselmann told the Financial Times: “We’re totally maxing out. 

“We’re seeing increased demand from all sectors. We’re at very close to full capacity.” 

Andreas Scheuerle, economist at DekaBank, echoed these warnings saying: “The boom is beginning to eat its children.” 

Angela Merkel‘s Germany last year excelled its potential growth rate of around 1.5 percent for the fourth consecutive year. 

But Stefan Kooths of the Kiel Institute for the World Economy, warned: “A boom might feel good, but it carries the seeds of crisis within it.” 

Meanwhile, Moody Investors Service said the fact capacity utilisation in the manufacturing sector was at its highest level since mid-2008 was a “signal that the economy is increasingly overheating”. 

However, others dismissed fears the economy is on the brink of collapse. 

Albert Braakmann, an economist at Destatis, the state statistical agency, told the paper: “Things are a bit tight in certain sectors, but overheating would mean that big wage increases were on the way, which would stoke inflation. 

“But wage rises are actually very moderate.” 

Clemens Fuest, head of Ifo, the economic think-tank, added: “The mood in German boardrooms at the start of this year is excellent. 

“Industrial companies see the current situation as better than it’s ever been.”