Germany braces for prolonged economic pain from Iran war, Chancellor Merz warns

German Chancellor Friedrich Merz warned Monday that the Iran war will have lasting consequences for the global economy, with Germany preparing for a significant and prolonged burden on its own economy.

"We will feel the consequences of this war for a long time to come, even after it is over," Merz said at a press conference in Berlin.

"Consequently, we are also preparing for a significant burden on the German economy for an extended period — and thus a considerable burden on private households as well."

The conservative leader expressed regret over the collapse of US-Iran talks held in Pakistan's capital Islamabad over the weekend, while noting he had anticipated difficulties from the outset.

"I wasn't surprised by the decision to break off the talks in Islamabad. From the very beginning, I didn't get the impression that they were really well prepared," he told reporters, adding that reaching a diplomatic solution would be a lengthy process.

"We are talking with the US administration, we are talking with the parties to the conflict, and we are talking with Israel," Merz said. "This will remain a long-term process," he stressed.