The corona shock plunged Germany and the whole world into a deep crisis. But what makes this crisis so special? How does it change our lives? And what are the ways out? The Personal-Financial.com Podcast “Zero Hour – Germany’s Way Out of the Crisis” asks these questions to the people who are steering through the crisis: entrepreneurs, scientists, managers, philosophers and economists.
The head of the Kiel Institute for the World Economy, Gabriel Felbermayr, fears that the German economy will not be able to recover as it did after the last crisis. Due to fresh emerging globalization fears and an increased tendency towards self-sufficiency and isolation, Germany cannot trust “to export healthily again after the crisis”, he says in the capital podcast “The hour zero”. All this goes “to the core of the German business model”.
As a result of the corona crisis, there are tendencies and scenarios that the world is divided into regional blocks of added value – i.e. North America, Asia and Europe. That would be a big blow to the German economy, which generates around 45 percent of its economic output through exports. Felbermayr observes that there is also a tendency towards new self-sufficiency in German politics – for example in medical technology. It is of course called differently, the whole thing is sold as “technological sovereignty”, among other things in the rescue plan for Europe of Germany and France just presented.
On the other hand, concerns about globalization are increasing again among the population. “Of course, you can now sacrifice all of this on the altar for disease control,” says Felbermayr. But that would be expensive for the German economy, “then we will give up a piece of German prosperity”. German companies would adjust to regional economic blocs and tailor their production and added value – but the German economy would lose as a result.
“A straight V or a U”
In addition, the importance of digital business models has grown due to the crisis – and here, too, the added value takes place primarily in the United States. Both trends threaten “a pincer attack on German prosperity”.
Overall, Felbermayr expects the German economy to slow down after the shutdown. Until recently, his institute had assumed a rapid, V-shaped recovery. Now it will be “an elongated V or a U”. The economy ended the free fall and “found a bottom”. But consumption has started more hesitantly than expected since it opened. “People are more scared than expected.”
You can hear the complete interview in the new episode of “Zero Hour – Germany’s Way Out of the Crisis”.
In the new podcast “Zero Hour – Germany’s Way Out of the Crisis” Personal-Financial.com Editor-in-Chief Horst von Buttlar talks to people who experience the corona crisis and its economic consequences up close. All episodes can be found on Audio Now, Apple Podcasts, Deezer, Soundcloud and Spotify. You can use the RSS feed for all other podcast apps. Take the feed URL and simply add “Zero Hour” to your podcast subscriptions.