IfW President sees Austria's main trading partner facing recession again
The President of the Institute for the World Economy (IfW), Gabriel Felbermayr, is assuming an economic decline for Germany at the end of 2020 and beginning of 2021 due to the new hard lockdown. “The fourth quarter of 2020 in Germany will be a very weak one and will end with a decline of around 0.5 percent compared to the previous quarter,” said the Austrian-based expert of the “Rhein-Neckar-Zeitung” on Tuesday.
In spring, too, “there will probably be another contraction in the first quarter of 2021, albeit not to the same extent as in the spring of the current year,” added Felbermayr. “That would put us in another technical recession.” This is considered to be the case if the economy shrinks for two consecutive quarters.
For the next year, Felbermayr is generally expecting a more positive development. “In the summer we should be able to get better numbers again,” he predicts. He considers the lockdown to be correct, despite the economic consequences: “As a citizen, I share the concern that the number of infections is too high and that we have to do something,” he told the newspaper. But “the politicians lack a plan for the period beyond January 10th”.
