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Concerns about the Corona crisis: Institute of the German Economy lowers economic forecast

2021-03-24T06:01:38.590Z


Because Germany is having a hard time getting the pandemic under control, the institute close to the employer is now also lowering its expectations. The shutdowns have already cost around 250 billion euros, according to economists.


Enlarge image

Container freighters in Hamburg: poor prospects for the economy.

Photo: Chris Emil Janssen / imago images / Chris Emil Janssen

The German economy is not getting rid of the corona worries: Now the researchers at the employer-related Institute of the German Economy (IW) have also lowered their economic forecast for 2021 because of the ongoing corona pandemic.

The gross domestic product will grow by three percent in the current year and by four percent in 2022, according to the IW.

At the same time, economists expect private consumption to stagnate.

In December, the Cologne economists had estimated an increase of four percent for 2021.

“So far, the lockdowns have already cost 250 billion euros.

There is currently a race between injections and infections, ”said IW Director Michael Hüther.

"We have to vaccinate quickly to forestall possible resistance through mutations." A long third lockdown would be an expensive setback for entrepreneurs and retailers.

"In addition, the division of the national economy into a robust industry and starving lockdown sectors would go deeper and deeper and have far-reaching social consequences," warned Hüther.

The IW economists view the third wave of infections with disillusionment.

"The pandemic is far from over, the lockdown will be extended until after Easter, vaccination is stalling, people consume little and companies are not investing as they did before the crisis."

The economy will not return to its pre-crisis level until the beginning of 2022.

Private consumption, which had slumped by six percent in 2020, will only stagnate overall this year.

Because rising infections and ongoing business restrictions keep people from spending money, according to IW.

"If the vaccination succeeds, a strong recovery, including catch-up effects, can be expected in the second half of 2021, but this will not be enough for an overall year plus."

mic / Reuters

Source: spiegel

All business articles on 2021-03-24

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