For the first time in years, the Treasury will be back in the red in 2021. "The budget surpluses of public budgets will decline significantly," said the researchers of the Kiel Institute for the World Economy (IfW) on Thursday. "While spending will continue to expand strongly, revenue will be significantly impacted by the weak economy."
After the record surplus of more than 60 billion euros in 2018 is expected for the end of the year and the coming, although still each with black numbers. For 2021, however, draw a "slight deficit" from. "The partial abolition of the soli reduces the revenue," it said. At the same time, for example, the implementation of the climate change bill will ensure additional spending.
According to the IfW, the gross domestic product will grow by only 0.5 percent in the year that concludes. In 2020, it should reach an increase of 1.1 percent, 2021 to 1.5 percent. "The economy in Germany only gradually regains its footing," emphasized the IfW. "Above all, the higher number of working days will be responsible for the higher growth rate in the coming year." The numbers coincide with those of the Munich Ifo Institute.
Household disposable income will continue to grow significantly, according to the forecast. "The construction industry is still booming, not least because of the continued favorable financing conditions," economists say. In the course of the coming year, production is also likely to pick up gradually. "This is also supported by the again slightly improving global economy." This benefits the export-dependent industry. However, a great momentum will not unfold.
