It’s five minutes to midnight for Germany’s status as a global economic force, the head of its central bank has warned after overseeing the Bundesbank’s first annual loss in 45 years.

Germany’s economy has been rocked from all sides in the last couple of years, challenging the fundamental viability of its economic model.

Russia’s invasion of Ukraine three years ago continues to place pressure on energy prices while fresh competition from China, in addition to falling demand in its key export markets, including China, has added pressure on manufacturers.

Fresh tariff threats from the Donald Trump administration have created the latest risk for Germany’s export-heavy economy.

German GDP contracted by 0.2% last year, adding to a 0.3% decline in 2023. Several economists expect a third straight year of contraction this year, with state-owned bank KfW forecasting a 0.2% decline this year.

Amid that gloomy backdrop, the Bundesbank added to Germany’s woes by announcing it had swung to a sizeable €19.2 billion ($20.1 billion) accumulated loss last year, its first since 1979.

The bulk of the fall came from a €13.1 billion negative balance to net interest income, a result of lower interest rates on its bond balance compared to rising market rates. While reassuring the public that the Bundesbank’s balance sheet was in a healthy state, Nagel couldn’t say the same about Germany’s economy.

“A slight economic recovery is expected over the course of the year. For the time being, however, no meaningful upswing is in sight,” Joachim Nagel, president of the Bundesbank, said after the release.

Nagel called for the new German government to take decisive policy action after Sunday’s parliamentary elections delivered a “clear government mandate.”

“Germany needs to fight for its competitiveness,” Nagel said, adding it was “five to 12” seemingly in reference to the Doomsday Clock that estimates the likelihood of a man-made global catastrophe.

“Smart, consistent and reliable economic policymaking can unleash a sense of change and increase the willingness for greater investment. I therefore hope that we will have a government that will rouse “German Michel” from his slumber,” said Nagel, referencing a patriotic figure similar to the U.S.’s Uncle Sam.

Nagel said there were clear structural problems in Germany’s economy, adding policymakers needed to address its new vulnerability as an export-oriented country and do better to prepare for the green transition and demographic change.

The Bundesbank avoided accumulated losses between 2020 and 2023 partly by releasing risk provisions, including a €2.4 billion provision in 2023. However, the central bank was forced to fall to a loss as its provisions fell to just €700 million ($734 million). It intends to offset last year’s loss through future profits.