Status: 10/26/2021 4:44 p.m.
The German economy is not yet really getting going again. For 2021, the government now only expects GDP growth of 2.6 percent – instead of the previous 3.5 percent.
The upturn in Germany this year is unlikely to be as strong as hoped. According to leading economic research institutes, the federal government now also wants to significantly lower its economic forecast for 2021. The main reasons are the consequences of the ongoing corona pandemic, as well as delivery bottlenecks and a shortage of raw materials. A strong economic recovery after the corona-related slump in 2020 is not expected until next year.
Only 2.6 percent expected for 2021
According to information from the dpa news agency, the federal government expects gross domestic product (GDP) in Germany to grow by 2.6 percent in the current year. In April, the government had expected an increase of 3.5 percent. For 2022, the federal government now expects growth of 4.1 percent instead of the previous 3.6 percent. The outgoing Minister of Economic Affairs Peter Altmaier (CDU) will present the autumn projection this Wednesday in Berlin.
Normalization in mid-2022?
The lowering of growth expectations for this year does not come as a surprise. In mid-October, leading research institutes lowered their economic forecast for this year to 2.4 percent. In the course of 2022, the German economy should return to normal capacity.
Worldwide delivery bottlenecks
The economic situation is still characterized by the corona pandemic, according to the institutes. This affects the service sector in particular. One consequence of the pandemic is global delivery bottlenecks. Last year the demand collapsed, now the global economy is picking up again, especially in Asia. However, traffic jams at ports and a lack of container capacity are hindering exports. Pre-products are missing or have risen sharply in price. The global shortage of parts is primarily dampening the international business of German industry. In October, companies’ export expectations fell, reported the Munich-based Ifo Institute.
According to the economists, the delivery problems with the preliminary products are having an impact on exports. In the chemical and automotive industries in particular, exports will grow more slowly than hoped for over the next three months.
Probably also effects on the tax estimate
The federal government’s lowered growth forecast is also likely to have an impact on the new tax estimate in November. Because this is based on the federal government’s autumn projection. The corona crisis had torn a big hole in the state coffers. Since the beginning of the year, however, tax revenues have risen again.