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Production at the Mercedes plant in Sindelfingen: Business in China is also slowing the economic downturn
Photo: Silas Stein / dpa
German industry expects the economy to decline less sharply in 2020 than previously feared.
According to the quarterly report of the Federation of German Industries (BDI), the gross domestic product (GDP) is expected to fall by 5.4 percent for the full year.
In August, the industry association was still expecting economic output to slump by 6.5 percent.
The BDI justifies the fact that after the unprecedented collapse of economic activity in spring the prospects are no longer quite so bleak with the fact that "an equally strong economic recovery" began in the middle of the year, "so that the economic performance in the first half of the year was contrary to our expectations has not collapsed quite as badly ".
The comparatively good situation in China also played a role.
Exports fell less sharply in the first half of the year than previously assumed.
"This was primarily due to the unexpectedly rapid recovery of the Chinese economy," says the BDI report.
For the year as a whole, exports are now expected to fall by 13 percent instead of the previous 15 percent.
With the somewhat more optimistic forecast for 2020, German industry is on the same line as numerous economic research institutes.
The German government also corrected its forecast for 2020 from minus 6.3 to 5.8 percent at the beginning of the month.
Like the BDI, the OECD industrial countries club is now expecting a decline of 5.4 percent.
If these currently valid forecasts were confirmed, the economic slump due to the corona crisis would be comparable or slightly weaker than in the financial crisis year 2009, at least for the year as a whole. At that time, GDP had shrunk by 5.7 percent.
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