Economy: “The effectiveness of the locks is no longer so great”

DIn the so-called economic modes, things are no different in the pandemic than in the rest of society: they do not agree on the evaluation of the crisis policy. With regard to lockdown measures in particular, there are quite different opinions in the Advisory Council on the assessment of macroeconomic development.

The body lacks clear leadership following the resignation of the previous president, Lars Feld, whose term was not extended in February because the federal government could not reach an agreement. The now four-person committee has yet to elect a new chair.

“I think the easing is premature,” said Achim Truger when presenting the economic forecast to the German Council of Economic Experts. “I think the risk that we will have a large number of infections again during Easter is quite high.”

His colleague Volker Wieland, on the other hand, expressly opposed a fundamental extension of the blockades. “You have to see that people are tired and the effectiveness of the general closures is no longer so great,” said Wieland.

Therefore, he recommended that politicians rely on other measures, such as increased testing and, above all, vaccines. Veronika Grimm, on the other hand, placed herself in the middle. There is no black and white when it comes to the question of whether to open or close the affected companies. “Thinking in black and white just unnecessarily polarizes,” Grimm said.

All four economies admitted that their forecast presented Wednesday is fraught with great uncertainty, mainly due to questionable progress in vaccination. Whether it will rise again for Germany this year, and how strongly, depends mostly on how quickly it is now possible to vaccinate the majority of the population against the corona virus.

Only 3.1 percent growth in 2021

The Council of Economic Experts currently assumes that the economy will grow by a total of 3.1 percent this year. Last fall, the five teachers at the time were more optimistic, expecting a 3.7 percent lead. In 2022, growth is now expected to be 4.1 percent.

The fact that the uptrend is now much slower is mainly due to the fact that the economy is also currently divided. “Despite the ongoing lockdown, we are far from the serious economic crisis of last spring,” Wieland said.

Above all, foreign trade and industrial production are doing so well that in some cases they have almost returned to their pre-crisis level. On the other hand, however, the entire service sector, retail and hospitality has been idle for months.

Depending on how long these shutdowns still last, the forecast for economic modes could also deteriorate significantly over the course of the year. If the lockdown lasts a quarter longer than anticipated, it will likely cost a percentage point of growth, Monika Schnitzer said.

“A third wave of infections is, of course, a major risk, as it could postpone recovery again,” Wieland warned. “We have to prevent this by significantly speeding up vaccination and testing.”

Veronika Grimm emphasized that an increase in the current vaccination rate by about 50 percent is necessary to achieve the federal government’s goal of vaccinating 70 percent of the population by the fall. To achieve this, vaccination centers should not only be at full capacity as soon as possible, but also GPs and specialists should be involved.

Now it depends on the speed of vaccination.

However, the current suspension of vaccinations with the AstraZeneca vaccine could lead to further delays, as the other available vaccines are much more difficult to administer in doctor’s offices. “However, it’s not that AstraZeneca’s unavailability postpones the goal,” Grimm said. So the hope lies in the availability of more vaccines.

However, the committee does not really agree with its assessment of the federal government’s vaccination progress to date. “There are lights and shadows in the vaccination strategy,” Grimm said. What went well and what went wrong must be analyzed in detail In Germany, mobile vaccination teams were used to a greater extent than in other countries, including in homes for the elderly and the elderly. This will now lead to a much steeper drop in the death rate, but it will take a little longer, with other countries leading the way in the number of vaccine doses administered.

Schnitzer also said that he did not want to “condemn” politicians, that transparency was needed, in particular, how decisions were made regarding the procurement of the vaccine. “However, I would have liked a more flexible vaccination strategy,” Schnitzer said.

Truger was already clearer: “My impression was that the basic problem was getting the vaccines,” he said. Wieland was the most critical. “You have to look at the result,” he said.

“A look outside shows that we cannot be satisfied with the result.” Other countries like the United States, Great Britain and Israel are significantly faster with their vaccination campaigns than Germany. “We have to learn from the best,” Wieland said. “We weren’t the best this time.”

Federal Economy Minister Peter Altmaier (CDU) also emphasized, in view of the forecast of economic methods, that it should now be accelerated with vaccination. “The rapid progress of vaccination and the constant use of rapid tests are two decisive levers in this phase of the pandemic, so that things can also improve for the entire economy,” he said.

Truger: Don’t Stop Helping Businesses Too Soon

Achim Truger cautioned against letting aid for affected businesses run out too soon. “In the event that the lockdown is prolonged, aid, of course, would also have to be extended,” he said. So far, bridging aid is limited to mid-year. “It would be a shame if, now, shortly before the pandemic is finally defeated, aid is reduced too quickly,” Truger said.

Also on this point, Wieland took a different position. “If our prognosis is correct, we reach a phase in which we must take care that growth is possible in the long term,” he said. Then you have to end the aid that was intended for the acute crisis, and then you also have to allow structural change.

“All in shares” is the daily take on the stock market by WELT’s business editorial team. Every morning from 7 am with financial journalists Anja Ettel and Holger Zschäpitz. For stock exchange experts and beginners. Subscribe to the podcast on Spotify, Apple Podcast, Amazon Music, and Deezer. Or directly through RSS.