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OECD corrects growth forecast for Germany sharply downwards

2020-12-02T06:07:47.075Z

The industrialized countries organization OECD no longer expects strong economic growth in Germany in 2021 - very different from the federal government.



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Photo: Ryan Tong / DPA

In view of the corona crisis, which has not yet been overcome, the industrialized countries association OECD expects a significantly slower economic upturn than initially forecast.

After a sharp slump in 2020, the world economy is only likely to grow by 4.2 percent in the new year, the Organization for Economic Cooperation and Development (OECD) announced in an economic forecast in Paris on Tuesday.

An increase of 3.7 percent is then expected for 2022.

In mid-September, the OECD forecast that global economic output would rise again by 5.0 percent for the coming year.

In the current year, the global economy will shrink by around 4.2 percent, according to the organization.

That is a little less than initially feared.

However, "for the first time since the outbreak of the pandemic, there is now hope for a better future," reported OECD chief economist Laurence Boone with a view to the expected corona vaccines.

"The worst was avoided (...)," she continued - because without enormous public support the economic and social situation would look worse.

Many states opened the money taps during the crisis to help businesses and citizens.

Increasing deficits are the result in many places.

According to the OECD, the German economy is suffering more from the corona pandemic than expected: The organization has revised its growth forecast for the coming year down to 2.8 percent.

This means that the OECD is significantly more cautious than the German government, which so far expects economic output to increase by 4.4 percent in 2021.

The corona crisis "continues to weigh on the economy" of the Federal Republic, according to the OECD.

"The rapid upswing in the third quarter of 2020 will be followed by a contraction in the fourth quarter and a gradual recovery in 2021."

For this year, the organization continues to expect the German gross domestic product (GDP) to collapse by around 5.5 percent.

For 2022 it then expects an upswing of 3.3 percent.

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beb / dpa

Source: spiegel

All business articles on 2020-12-02

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