- Increase in global gross domestic product (+2.7%) weaker than in previous year and lower than our original forecast (+3.3%)
- Significant growth slowdown in the second half of the year
- Uncertainty in the financial markets due to intensification of the national debt crises in the eurozone and the United States
The strong growth momentum from the previous year continued in the first half of 2011. However, this economic upturn was followed by significantly weaker growth in all regions in the second half of the year. This development was influenced by uncertainty in the financial markets as a result of the intensification of the national debt crises in the eurozone and the United States. Compared with the previous year, global gross domestic product therefore did not rise as sharply (+2.7%) as we had originally forecast for 2011 (+3.3%).
Global gross domestic product growth (+2.7%) at the beginning of 2011 was driven by both the previous year’s economic upturn as well as by strong economic growth in the emerging markets. By contrast, negative growth impetus over the course of the year came mainly from the industrialized countries: The intensification of the national debt crises in the eurozone and the United States led to lower growth expectations, despite an overall good level of incoming orders. Consumer confidence decreased. The decline in worldwide demand for goods dampened growth in international trade.
Development by region
Gross domestic product 2011
Real change compared with the previous year
While gross domestic product in the European Union grew substantially in the first half of 2011, growth weakened in the second half. Private consumption in particular lost momentum. Given the high national debt levels of some European countries, there was considerable variation in growth rates. Overall, gross domestic product grew almost as fast as in the previous year (2010: +1.8%; 2011: +1.6%). Germany in particular benefited from good foreign demand for capital goods and posted a comparatively high level of economic growth (2010: +3.6%; 2011: +3.0%).
In 2011, the U.S. economy grew only half as much as in the previous year and was weak overall (2010: +3.0%; 2011: +1.6%). Ongoing high unemployment rates particularly led to lower spending among U.S. consumers. Furthermore, economic growth was negatively impacted by prolonged political debate over raising the debt ceiling and necessary fiscal consolidation measures. The continued low level of construction investment additionally slowed overall economic growth.
Although gross domestic product growth in Asia (excluding Japan) was lower in 2011 than in the previous year, the region nevertheless saw comparatively strong growth (2010: +9.2%; 2011: +7.1%). The most important regional growth driver was China (+9.2%), where government investment programs strengthened the domestic economy. However, higher interest rates as well as the creation of overcapacities weakened both consumer demand and investment activities in China. India also posted strong growth (+7.6%).
Economic output fell sharply in Japan following the earthquake and tsunami disaster in March 2011; gross domestic product shrank (–0.5%). The appreciation of the yen also negatively impacted the export sector.
Growth slowed in South America in 2011 (2010: +6.4%; 2011: +4.0%). While rising raw materials exports initially strengthened economic development, many countries in South America experienced increasing inflation rates. In Brazil in particular, the Central Bank’s more restrictive monetary policy at the beginning of the year and higher interest rates dampened private consumption and investment activities.