The problems of the past year are expected to continue to weigh on the economy in 2023. For the capital, the investment bank Berlin still believes in a small plus.
The investment bank Berlin (IBB) expects an economically difficult year for the capital in 2023 with expected minimal growth. The downside risks for the coming year are high “because Berlin cannot escape the deteriorating economic conditions,” said the IBB on Wednesday.
“The effects of high energy prices, jerky supply chains and a high number of people suffering from flu and corona are an additional burden on companies and will slow down the economy in the first half of 2023.” Ultimately, Berlin’s economy could “land just above zero”, according to the state’s own promotional bank.
For the current year, the economists at IBB believe that growth of around 2.5 percent is possible – partly due to a surprisingly good third quarter. But: “The recovery that followed the corona pandemic in 2022 could not fully unfold due to the energy crisis,” said Hinrich Holm, CEO of IBB. “Due to persistently high prices, energy-intensive small and medium-sized companies in particular could get into trouble in the next two quarters.”
According to the IBB, the service industries and the information and communication sector have recently developed particularly positively. The postal and courier services sector, which had expanded significantly during the pandemic, had to accept a drop in sales after the end of many corona measures.
According to the IBB, the Berlin labor market continues to be robust. According to the regional directorate of the Federal Employment Agency, 1.67 million people were employed in the capital subject to social security contributions in September – 3.9 percent more than in the same month last year. Almost 20,000 jobs were open in November.
The development bank assumes that the “rapidly increasing building interest rates”, the shortage of skilled workers, delivery bottlenecks and price increases will slow down housing construction. “Even if the purchase prices should drop a bit in the future, the bottom line is that financing a property in Berlin will be more expensive, so that more people will remain on the rental market for the time being,” it said. Accordingly, the demand for living space remains high. (dpa)
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