The industrial nations organization OECD predicts less growth for the German economy this year due to supply bottlenecks in industry. The gross domestic product will increase by 2.9 percent in 2021, according to the outlook published on Tuesday. In May, the OECD experts had forecast an increase of 3.3 percent. For this, the forecast for 2022 has been increased from 4.4 to 4.6 percent. Last year, Europe’s largest economy collapsed by almost five percent due to the corona pandemic.
“The auto industry, which is heavily involved in global trade, and the manufacturing sector as a whole are particularly hard hit by global delivery bottlenecks and logistics difficulties,” said the head of the OECD Berlin Center, Nicola Brandt, explaining why the forecast was lowered. “That of course slowed the recovery of the German economy.” On the other hand, the demand for German industrial goods remains strong. “We expect a gradual resolution of the delivery bottlenecks from the fourth quarter and then a stronger recovery,” said Brandt.
For the global economy, the OECD expects growth of 5.7 (previously: 5.8) percent this year, and an increase of 4.5 (previously: 4.4) percent in the coming year. The global gross domestic product has already exceeded the level reached before the pandemic: “But in many countries, especially in the emerging markets, there are still production and employment gaps.” This applies above all to those countries in which vaccination rates are low. The OECD therefore advises the central banks to continue to support the upswing with low interest rates – despite rising inflation. The organization expects the rate of inflation in the 20 most important economies to average 4.5 percent at the end of this year. At the end of 2022, however, it should fall to 3.5 percent. For the US economy, the growth forecast for this year has been lowered from 6.9 to 6.0 percent, while it has been raised from 3.6 to 3.9 percent for 2022. The Chinese gross domestic product is likely to grow even faster: the forecasts of 8.5 percent this year and 5.8 percent next year have been confirmed – despite the crisis surrounding real estate developer Evergrande.