The weak economy in Europe and a slowdown in the fast-growing emerging markets of China, India and Brazil have dampened global economic growth. In 2013, some EU member states recorded a further decline in their economic output. In particular, gross domestic product (GDP) contracted again in the southern European countries of Italy, Spain, Portugal and Greece. Germany escaped this trend, increasing its GDP slightly. In the USA, the economy grew moderately.
The International Monetary Fund (IMF) estimates that the world economy grew 3.0 percent in 2013 (2012: 3.2 percent). Originally, the IMF had expected growth of 3.2 percent.
GDP Trends in 2013
Sources – worldwide: IMF; Asia: ADB; China: National Development and Reform Commission; India: ADB; Japan: IMF;
USA: IMF; Europe: IMF; Germany: Federal Statistics Office
Asian Growth Slows Further
Growth in Asia weakened in 2013. The Asian Development Bank (ADB) expects GDP expansion of 6.0 percent (2012: 6.1 percent). The new Chinese government wants the country’s economic growth to be sustainable in the future, rather than being generated at any cost. According to the National Development and Reform Commission, China’s economy grew by 7.7 percent (2012: 7.7 percent). India’s economy is facing major infrastructure problems and a reluctance to introduce key structural reforms that could stimulate growth. India’s GDP climbed by 4.7 percent (2012: 5.0 percent) according to the ADB. The Japanese economy grew due to the government’s economic policies and the weak yen. According to the IMF, Japan’s GDP grew by 2.0 percent (2012: 2.0 percent).
US Economy Expands Moderately
Despite political controversy about the budget, the US economy grew moderately in 2013, due to steady domestic demand and slightly lower unemployment. According to the IMF, GDP rose by 1.6 percent (2012: 2.8 percent).
Eurozone Still Dominated by Debt Crisis
Europe’s sovereign-debt crisis continued to dampen economic output in 2013, with many crisis-hit economies still in recession. Austerity programs, loss of income and high unemployment subdued consumer spending and corporate investments. However, there are initial signs that growth may resume in 2014. According to IMF calculations, GDP in eurozone countries dropped by –0.4 percent (2012: –0.6 percent).
German Economy Remains Resilient to Euro Crisis
Germany’s economy again proved robust amid the euro crisis, in contrast to most other European countries. As a result, Germany reinforced its role as Europe’s leading economy, benefiting from both export strength and solid domestic demand. With unemployment remaining low and employment at a high level, tax-revenue increased, further easing debt growth. Data issued by the German Federal Statistics Office show that GDP increased by 0.4 percent (2012: 0.7 percent).