The corona pandemic has caused great economic damage in the past two years. The Institute of German Economics (IW) in Cologne comes to the conclusion that the so-called loss of added value is around 350 billion euros.
Less Consumption through Lockdown
A big reason for the loss of 350 billion euros is the drop in private consumption, which is partly due to lockdown measures. In recent years, lower corporate investment has contributed to the losses. The German Economic Institute says that there could be further defaults of 50 billion euros in the first three months of this year. “The recovery will take years,” says IW’s further analysis.
Still facing lockdowns and 2G regulation, we are forcing masses of consumers into mail order. Does your shop around the corner benefit from this? The mail order business is dominated by a few wholesalers. These wholesalers have been able to achieve enormous increases in sales and profits. What about the little shops on your street?
This has hardly harmed the large corporations that collect our tax money from the state as “corona bonuses”. Many companies have only survived thanks to state aid and many many other small companies are over-indebted or have closed forever. Unfortunately, there is little or no support for the 15-strong company. What about the smaller shops, gastronomy and tourism? The Corona crisis continues to threaten the existence of small and medium-sized companies.
Uk and Denmark drop all mandatory restrictions
It becomes easier for individuals and businesses alike in the UK and Denmark with hopefully more countries to follow. Denmark has lifted all Covid-19 restrictions making it the first country in the EU doing this. According to BBC the authorities in Denmark state that:
While cases are still relatively high, the authorities say the virus no longer qualifies as a “critical threat”.
The epidemiologist Lone Simonsen stated that the Omicron is no longer a severe disease and that it is reasonable to lift restrictions.
In Germany and Austria individuals and businesses still struggle with the measures in place.
The Tages Spiegel Reports:
About 12,000 nurses in Germany have registered as jobseekers before the introduction of the compulsory vaccination. Isn’t there a shortage of nursing care in retirement homes?
The Frankfurt Algemein Reports:
The levels of natural gas in the storage facilities in Germany are falling. As of January 30, 2022 the facilities have a level of 37 percent which is very low for this time of year. The main supplier of natural gas is Russia. With the conflict in Russia, Ukraine and the West the question arises how secure is the energy supply in Germany and Austria?
Business Insider Germany Reports:
Energy costs for families have risen from 3891 euros to 6092 euros per year since January 2021.
The Mirror Reports:
Trade association expects the closing of 16,000 stores this year.
The 2G regulations continue to deter customers, says the German trade association. The ongoing delivery difficulties are also causing problems for many retailers. The result: Thousands of companies may close in 2022.
The Tages Spiegel Writes:
Grocery chains are calling for the end of 2G nationwide in Germany.
The four major German food chains – Edeka, Rewe, Aldi and the Schwarz Group (Lidl, Kaufland) – have set up a “solidarity address” to the government for the non-food sector.
“We share the deep existential concerns of the stationary non-food trade and see the danger of thousands of closures, especially owner-managed shops and their devastating effect on our inner cities, the location agglomerations and therefore the stationary retail trade in Germany as a whole,” wrote the CEOs, whose stores themselves are not affected by the 2G regulation. “We would therefore like to ask you to work towards lifting the 2G access restrictions for non-food retail.”
“On the basis of our almost two years of experience with the pandemic, we can conclude that retail with the appropriate hygiene concepts (essentially the obligation to wear a mask and maintaining distance) is not a source of infection.”
Supply Chain Issues
If we look back and remember, the lockdown measures at the beginning of the pandemic led to problems with the production processes. This led to delivery disruptions at home and abroad. According to studies, the problems in the supply chains were acute. With the collapse of global supply chains came temporary factory closures, logistical chaos and port closures. Containers piled up and were not shipped to their destination.
The finance ministers of the euro zone have promised economic aid until the end of 2022 in view of the corona pandemic. In a statement by the so-called Eurogroup, rising debt will not be addressed until the economy recovers. What miracle can then happen to fight all national debt? Will there be more taxes or a change in our economic and financial system? The World Economic Forum would like to give governments answers to these questions.
economic and financial system
Wirtschafts- und Finanzsystem
Wealth managers like BlackRock and other wealthy individuals are playing a key role in shaping the “Great Reset” discussed at the World Economic Forum in Davos to discuss issues ranging from one global economy to full digitization and surveillance of all individuals. How will the economic and financial future be shaped? It most likely won’t go back to what it was, so let’s hope it will be a future where every life matters.