Forecast
Economic development
It is to be expected that the recovery in the global economy will continue in 2011. In this context, the inconsistent picture across regions – moderate growth in the industrial nations, vigorous growth in emerging markets – is likely to remain unchanged. In countries whose economic recovery was not hampered by structural problems, the crisis-induced slump has been largely made good. Consequently, economic growth here is likely to slow somewhat in 2011. In countries experiencing structural problems, on the other hand, the available options for delivering economic stimuli are largely exhausted. Here, the necessary consolidation efforts are expected to prove a drag on the pace of expansion. All in all, global output in 2011 is likely to show a low single-digit percentage increase. Such forecasts are, however, subject to risks: particularly notable threats to the development of the world economy could derive from the protracted tension on European government bonds markets as well as from another sharp correction in real estate prices in the United States or China.
The economic rally in the United States will be exposed to considerable risks in the current year owing to ongoing structural problems. With both earnings and sales prospects under strain, especially for small and mid-sized enterprises, the speed with which equipment spending is stepped up could come under pressure. Given the minimal economic growth impetus, the prevailing exceptionally high level of unemployment will probably drop only slightly; the ifo-Institute estimates the average jobless rate in 2011 at 9.5%. GDP is forecast to rise by 1.7% in 2011.
In Germany, on the other hand, the outlook for economic growth is positive. Favourable earnings prospects, job security and low interest rates will likely encourage private consumption and housing investment. Corporate spending should also increase. Yet the economic momentum in Germany will probably be considerably less pronounced in 2011 than in 2010. Global economic stimuli will be weaker and foreign trade is expected to make just a modest contribution to the increase in real gross domestic product. What is more, the federal government is steering towards a course of consolidation, which will also have a restraining effect. All in all, real GDP as calculated by the ifo-Institute is likely to increase by 2.4% in 2011. Manufacturing output in Germany should therefore again surpass the European average in the coming year.
In the Eurozone, too, the upsurge in the economy should be sustained; the ifo-Institute expects GDP to rise by 1.4% overall in 2011. The differences between member states will likely remain considerable. In countries with relatively solid public finances and no major structural problems, such as Germany, Finland, Austria and the Netherlands, the economy should grow at an above-average pace and unemployment should fall. Countries on the European periphery, however, will likely experience only a sluggish recovery (for example in Spain, Italy or Ireland) or even recession (for example in Greece). The enormous repercussions of the crisis and the pressure to consolidate will be adverse factors here. In 2011 all Eurozone countries will embark on a course of fiscal consolidation. As a result, public spending and disposable incomes will likely be detrimentally affected. The resurgence in domestic demand will consequently slow.
In China the pace of expansion will likely diminish in 2011, although it will remain on a high level. An increasingly restrictive monetary policy will probably play a role here and should ultimately restrict the growth in economic output to 8%.
In Japan the government and central bank are trying to counteract the slowdown in economic growth. In November 2010, for example, the government approved a further economic stimulus package, while the Bank of Japan launched another asset purchasing plan. A more modest rate of expansion than in 2010 should nevertheless be anticipated.