German Economic Institutions – RWI in Essen, DIW in Berlin, IFO in Munich and IWH in Galle – reduced the growth forecast of the largest European economy for 2021 to 2.4 percent from 3.7 percent, since the global problem of failures in supply chains hit the recovery of the country, reports Reuters.
It is expected that institutions will increase GDP growth forecast for 2022 to 4.8 percent from 3.9 percent. For 2023, an increase of 1.9 percent is predicted. If a new forecast is true, then the overall growth prospect of the eurozone economy will decrease.
German statistical data showed that the export volume unexpectedly decreased in August for the first time in 15 months, since failures in supply chains, from which the world economy suffers, continued to deteriorate. Problems in logistics have become the deceleration of global production. The problem aggravated the shortage of commodity containers for transporting goods, clogged ports and a shortage of logistics workers.
Against the background of supply failures The International Monetary Fund (IMF) reduced world GDP growth forecast for 2021 to 5.9 percent from the July forecast of six percent. The IMF also reduced the growth forecast for German GDP for 2021 by 0.5 percent compared with the July 3.1 percent outlook.