The Minister of Economics has already called the “diagnosis” inspiring.
Experts from major German research institutes concluded that “a pandemic will lead to a severe recession in Germany.” This is stated in the report of analysts, released on Wednesday, April 8.
According to the forecast, German GDP this year will decrease by 4.2 percent. Moreover, the sharpest reduction is expected in the second quarter – by 9.8 percent. This indicator will be the worst in the last 50 years. Such negative trends will lead to a budget deficit in Germany, both federal and individual regions. In total, the deficit can reach 159 billion euros, which will be a record for Germany.
The situation in the labor market will also worsen. Analysts estimate that unemployment will rise to 5.9 percent.
In fact, this means 2.5 million unemployed citizens and about the same number of people working part-time.
At the same time, economists believe that 2021 will be more successful for Germany. In particular, GDP is expected to grow by 5.8 percent.
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German Minister of Economics Peter Altmayer praised the report as “an encouraging diagnosis.” The official expressed the hope that the government will be able to restore the economy after the coronavirus pandemic.