German economy will shrink by 10% in 2020

US, WASHINGTON (ORDO NEWS) — The German Federal Chamber of Commerce and Industry (DIHK) expects Europe’s largest economy to contract by at least 10% this year due to the coronavirus pandemic, writes Reuters.

The German government predicts a record decline in GDP of 6.3% in 2020.

The German economy has already entered a recession , having experienced the maximum decline in the I quarter since the global financial crisis.

The economic outlook remains extremely uncertain, since the pace of recovery is largely dependent on the situation with coronavirus.

In 2021, according to DIHK forecasts, GDP will grow by about 5%.

A DIHK survey conducted among approximately 10 thousand industrial companies from May 4 to 6 showed that three quarters of firms have experienced declining demand and 80% expect a significant drop in sales.

“German business is facing the biggest challenge since the end of World War II,” said DIHK President Eric Schweizer.

Almost 50% of German industrial companies are putting off investments and plan to cut their budgets because of the COVID-19 pandemic.

The survey also showed that due to disruptions caused by the outbreak of coronavirus in many countries around the world, almost a fifth of German industrial companies are now reorganizing their supply chains.

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