EUROPEAN ECONOMY German chemical industry braces for a slowdown

Abstract

The largest chemical industry in Europe has jettisoned earlier predictions for this year and next. Now, the German Chemical Industry Association (VCI) is forecasting stagnation for 2008 and a production drop in 2009. After four years of good growth, German chemical production next year will drop by 1% from 2008 levels, VCI President Ulrich Lehner predicted at the association’s end-of-year press conference in Frankfurt. He blamed the drop on “falling demand from industrial customers, and in particular from the automotive and construction industries,” and on “the reserved consumption behavior of consumers.” Lehner said he sees no end to the troubles until the second half of 2009. That consumer behavior is expected to continue, economists warn, as Germany slips into recession. In a report last month, the German Council of Economic Experts predicted that the country will experience no growth in gross domestic product next year. Only the chemical industry’s large pharmaceutical sector, Lehner said, is ...