Deutsche Wirtschaft während COVID-19

According to the latest figures from the World Health Organization (WHO), the rampant global COVID-19 pandemic has left around 5,000,000 infected and over 330,000 dead to date, sparking fears that the global economy could be pushed into recession.

The United Nations Conference on Trade and Development said in a recent report that the COVID-19 pandemic could lead to a 30-40 percent drop in global foreign direct investment (FDI) flows in 2020 and 2021.

With millions of workers losing jobs and livelihoods, and countries predicting their worst downturn in decades and even centuries, the pandemic is now threatening the vital networks that connect the global economy.

Cross-border supply chains have been severely constrained by the impact of the COVID-19 crisis on global import and export volumes, reducing spare parts inventory, causing production disruptions and revenue slumps. This has increased the risk of default for many companies. Both car manufacturers and manufacturers of consumer electronics are under considerable pressure in the supply chain.

The German economy

The German economy is not expected to recover from the effects of the coronavirus crisis until the end of 2021.

Germany's economy shrank 2.2% in the first three months of this year as the coronavirus pandemic pushed the country into recession, according to official figures.

It was the largest quarterly decline since 2009, when the country was gripped by the global financial crisis.

The figures from the Federal Statistical Office come at a time when Germany is taking the first cautious steps towards a ban on promotion.

Shops are reopening, students are gradually returning to classes and football is starting up again behind closed doors.

At the same time, the figures for the last three months of 2019 have been revised and show a decrease of 0.1%.

That means German GDP growth has been negative for two consecutive quarters, the technical definition of a recession.

Germany is preparing deadline extensions

The Bundestag has passed legislation to extend deadlines for renewable energy developers working on projects during the coronavirus pandemic.

After the amendment of the Renewable Energy Sources Act in 2017, the deadlines for the completion of subsidized systems are to be extended by six months.

Developers who plan to commission projects by the end of June will also get a six-month extension to meet technical regulations for power generation facilities under the law.

Legislators have also planned to end privileges for community energy companies that are allowed to participate in onshore wind energy tenders without permits under the Emission Control Act. This has led to many highly speculative bids in the past that have not led to the construction of projects, the Department of Energy said.

Several German economic sectors have been seriously affected by the effects of the COVID-19 mitigating measures. Travel agencies and tour operators reported the sharpest drop in vacation packages to Germany, followed by aviation and the hotel and catering industry. World's leading economies are tumbling as businesses are closed for almost 2 months. Compared to such industries, online businesses like digital marketing agencies, online betting, technology service providers, online trading, e-commerce companies, etc. do not have to completely shut down their operations.

But the art and entertainment sector and vehicle construction are also affected. The only industry that has experienced an upswing is the pharmaceutical sector. This is reflected in a recent rise in the price of Bayer stock, which contributed to a general upswing in the opening European markets on Monday.

The Ifo Institute forecast that all sectors of the economy could experience a rebound from the third quarter and beyond as the market lockdown is gradually eased.