Economist sees a damper: Lockdown weakens upswing in 2021

Wirtschaftsweiser sees a damper
Lockdown weakens upswing in 2021

As hard as the lockdown is for the companies concerned: This year it will hardly have any impact on the economy, says the head of economic activity. In the coming year, on the other hand, Germany is likely to miss the strong economic growth that experts have expected so far.

Due to the impending hard lockdown, economic growth in the coming year is likely to be lower than previously assumed. This expectation was expressed by the chairman of the Advisory Council on the Assessment of Overall Economic Development, Lars Feld, in the newspaper "Die Welt". In their annual report, the economic wise men assumed an increase of 3.7 percent for 2021.

Feld did not name a new percentage. He is assuming "that the first quarter of 2021 with the extended restrictions will turn out a little worse than the council of experts assumed in its forecast in the annual report," he said. The extension of the Christmas holidays will also have an impact. The further course of the economy depends on the strength of the "rebound effect," said Feld: "If the economy moves forward as strongly in the second quarter of 2021 as it did in the third quarter of 2020, we can be more confident again."

For the current year, the expert no longer expects any major effects on economic growth. "The economic activity at the end of and at the beginning of the following year is always somewhat reduced anyway," he said in support of the reason. In addition, the majority of people can continue to work, supply chains are largely intact.

"Data protection before human life"?

Feld welcomed the fact that the federal government is now changing its strategy for corporate aid in the crisis and wants to gear further compensations back to fixed costs instead of sales. In doing so, she is following the recommendations of economists. "Orientation towards sales of the same month last year would be excessive," said Feld, referring to the November and December aid, especially for the catering industry.

Feld criticized the fact that accompanying measures such as the Corona warning app were not used more intensively. "Testing and Tracing" strategies are very successful in Taiwan and South Korea, for example. "In this country you could get the impression that data protection comes before human life," criticized the economic expert.

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