Trends in the global economy in 2013
- Global gross domestic product growth not as strong as in previous year (2013: +2.3%; 2012: +2.5%), remaining lower than our original forecast (+2.6%)
- Slow start to the year in major emerging markets and in Europe
- Indications of global economic recovery toward end of year
In 2013, global economic growth was once again weaker than in the previous year. The beginning of the year was particularly sluggish for the major emerging markets and Europe. Growth was somewhat slower in the United States, as well. The end of the year saw indications of recovery in the global economy. At 2.3%, global gross domestic product did not rise as much as it did in 2012 (+2.5%)1 or as we had originally forecast for 2013 (+2.6%), despite positive developments in Japan.
Gross domestic product
Real change compared with previous year
Economic development was marked by sharp fluctuation in 2013. The debt crisis and resulting consolidation efforts continued to put a strain on the economy in Europe. In addition, the unusually cold winter in Northwestern Europe was detrimental for construction spending and private consumption. The weak European economy – especially at the beginning of the year – negatively impacted development in the emerging markets. Political uncertainty had a dampening effect, as well. Indications that the U.S. Federal Reserve would tighten its fiscal policy led to considerable depreciation in many emerging market currencies. Uncertainty declined toward the end of the year after economic data suggested that the European economy was bottoming out, and the Chinese economy picked up speed.
Trends in the global economy by region
In the European Union, gross domestic product stagnated in 2013. This was mainly on account of the first quarter’s significant decline in growth. Growth rates were positive from the second quarter on; the slight recovery was predominantly supported by foreign economic influences. Domestic demand remained weak due to high unemployment rates in Southern Europe and a low propensity to invest. While the Spanish and Portuguese economies showed slight growth again over the course of the year, the recession in Italy continued unabated.
The Eastern European countries only achieved minimal gains. Of the larger EU countries, only the United Kingdom saw unexpectedly strong growth. Germany was not able to escape this weak European environment: At 0.5%, growth in gross domestic product remained very low (2012: +0.9%) and was mainly driven by private consumption.
The United States saw moderate but weaker growth compared with 2012. Dampening effects came from the government; public spending declined overall. Budget cuts in the spring and the consequences of the budget and debt dispute in the fall also negatively impacted the economy. Private consumption, however, benefited from the continued recovery of the job market. Investment grew, as well.
The economy in Asia (excluding Japan) experienced growth as strong as in 2012. Growth in China accelerated over the course of the year, and at 7.7%, remained at the previous year’s level. The other emerging markets of Asia posted somewhat lower growth rates on average compared with 2012. Aside from weak global growth, one factor here was the considerable depreciation of these countries’ currencies with respect to the U.S. dollar.
Gross domestic product in Japan grew comparably fast, as in the previous year. This was largely owing to government spending programs and the weak yen.
Growth in South America was slightly higher than in 2012, yet remained considerably below the average of previous years. Gross domestic product grew somewhat faster, especially in Brazil and Argentina, driven partly by the dynamically growing agricultural sector. High inflation rates, infrastructure bottlenecks, low raw material prices and a deteriorating consumption climate all dragged at the growth dynamic. By contrast, Chile, Peru and Colombia posted robust growth.
1 Weighting by country changed as a result of updating the baseline year. Prior-year figures have been adjusted accordingly.