The virus sent Germany into recession, to survive until the middle of the year | Instant News


BERLIN: European economic locomotive German fell into recession in March, with the slump triggered by coronavirus The pandemic is likely to last until the middle of the year, the economy ministry said Wednesday, “A collapse in global demand, supply chain disruptions, changes in consumer behavior and uncertainty among investors” have all made them feel in export giants, the ministry said.

The economic blow from the virus fell precisely as Germany began to recover from 2019 marked by the impact of the trade war and Brexit fears.

Industry in particular have seen increases in new orders and activities while 2020 is underway, the ministry noted.

But “given the massive demand and supply shock at home and abroad from the coronavirus pandemic, economic development has reversed direction” for producers, he said.

At home, Germany is getting tighter since mid-March, with Chancellor Angela Merkel is set to discuss with the country’s prime minister on Wednesday whether to extend the restrictions beyond the April 19 deadline.

“Even if the first protective measures can be eased a little (after April), growth will remain very muted and only rise little by little,” the ministry of economics predicted.

To reduce a few punches, Berlin has passed a 1.1 trillion euro rescue package, from guarantees for bank loans to businesses to state funds that can buy shares in disaster-stricken companies if necessary.

The federal government also facilitates access to schemes that increase workers’ wages if their employers cut work hours.

BA federal employment agency said around 725,000 companies had applied for assistance, adding that the number of affected workers would be “significantly” above 1.4 million which helped in the 2008-9 financial crisis.

Berlin estimates that around 2.1 million workers must return to support.

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