Berlin: According to data released by the Federal Statistical Office (Destatis) on Wednesday, Germany's public debt will have surpassed its previous high of €2.37 trillion ($2.6 trillion) by the end of 2022.

Compared to 2021, there was an increase of €46.1 billion ($50 billion) or 2% in the overall public budget's debt to the private sector. In response to the Covid-19 pandemic and the energy crisis, Destatis attributed the rise to emergency measures.

A threat to economic prosperity is posed by spiralling inflation, a severe energy crisis, and expectations of a further slowdown in the largest economy in the EU.

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According to economists, Germany's struggling economy as a result of the pandemic and the energy shortage is demonstrated by the rising debt owed to the private sector. According to Destatis, the non-public sector includes banks and other domestic and international economic sectors, such as private companies in Germany and abroad.

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Public borrowing has increased significantly as a result of the government's efforts to lessen the effects of these crises. The state won't be able to quickly address current economic issues like declining wealth levels, according to German Finance Minister Christian Lindner, who previously stated that the government must limit its spending.

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German industry, which is primarily powered by natural gas, has been struggling to keep up with the country's soaring energy prices. By as early as mid-2024, the country has vowed to replace imports from Russia, which was once its biggest supplier. The energy shortage has been exacerbated by efforts to diversify petrol supplies.