Even the Christmas holiday brought no break in the cloud hanging over Europe’s largest economy and silver linings are conspicuous by their absence, according to a consensus survey of Germany’s main industry associations published Thursday.

Consolidating the expectations of forty-four national industry associations, Köln-based IW Institute reports that thirty-one respondents expect production and sales in 2002 either to decline or stagnate. This indicates a “worrying trend” that even Germany’s powerful export-oriented sectors are expecting worse times ahead, opined IW’s Jörg Beyfuss.

Only the nation’s food industry looks forward to better times in 2002, while the expectation of employing more staff is limited to the insurance, information technology and leasing sectors.

The findings contradict a glimmer of light revealed in two other recent business polls – the influential Ifo business climate index and the ZEW Institute’s monthly economic sentiment survey – both of which posted surprise gains earlier this month [WAMN: 12-Dec-01].

IW believes a turnaround could happen mid-year dependent on improvements in the world economy and moderate wage settlements in early 2002: “Settlements that really reflect the country's difficult economic circumstances”, says Beyfuss.

News source: Financial Times