Germany enters recession, leaded by the coronavirus

L'Allemagne entre en récession, plombée par le coronavirus

BERLIN | Germany has suffered a decline of 2.2 % of its gross domestic product (GDP) in the first quarter, due to the coronavirus, entering officially into recession, announced on Friday the federal statistics office Destatis.

The German economy is experiencing its “worst result since the economic crisis of 2008/2009, and its second worst since the Reunification” in 1990, says the institute, even though the measures of restrictions aimed at controlling the pandemic, with the price of a strong impact on the activity, began in mid-march, at the end of the quarter.

“This is only a beginning,” summed up the economist, Carsten Brzeski, of ING Bank, since the pandemic is expected to affect more violently the second quarter.

The German economy between now already in a technical recession, i.e. two consecutive quarters of contraction in GDP: Destatis, which had initially estimated that its production had stagnated in the last quarter of 2019, is estimated now that it has retreated by 0.1 %.

“The consequences of the pandemic for this quarter are extremely serious,” said Albert Braakman, of Destatis, at a press conference in line.

About a year ago, the GDP contracted by 2.3% in seasonally adjusted terms, the largest decline since the second quarter of 2009, at the height of the financial crisis.

For the second quarter, between April and the end of June, the main economic institutes of the country provide for a fall of 10 % of GDP over a year, never seen since 50 years.

For all of the year 2020, the German government expects a recession of 6.3 %, the highest since the beginning of statistics in 1970.

Like all european countries, the German economy suffered a shock, multifaceted, since the containment decreed in the face of the health crisis that has paralysed the production of many sectors, slowed sharply in the exchanges and restrained consumption.

Share Button