Corona measures - what economists advise

Many economists are looking at the rising coronavirus infection figures with growing concern. According to Ifo President Clemens Fuest, an economic recovery is only possible if the pandemic is brought under control. He advocates "regional mini-lockdowns" in regions with high infection rates. According to Marcel Fratzscher, President of the German Institute for Economic Research (DIW), the greatest damage to the German economy would be caused by a strong, long-lasting second wave of infections, not by targeted restrictions on daily life. He believes a small lockdown with restrictions on contact between households, gatherings and travel is necessary. Michael Hüther, Director of the German Economic Institute (IW), warns that the economic policy instruments have largely been exhausted. Society must learn to live with the virus. There is a consensus among economists that there should be no border or school closures.

Extension of corona aid planned
In view of the rising number of new coronavirus infections and increasing concerns about a new lockdown, the German government is planning to extend aid for SMEs and the self-employed until the middle of next year. The ministry is negotiating with commercial credit insurers to extend the guarantees, which expire at the end of the year, until June 30, 2021. An extension would require approval from the EU Commission under state aid law.

Economy warns of new lockdown
As a result of the sharp rise in coronavirus infection figures, there is growing concern in the economy about a renewed shutdown of public life. "A second lockdown would have fatal consequences for the slowly recovering German economy," says BDI Managing Director Joachim Lang. The economy must be strengthened with targeted measures and at the same time the further handling of the pandemic must be planned. According to Clemens Fuest, President of the Ifo Institute in Munich, the first priority from an economic perspective must now be to contain the infections. It is better to put the brakes on now than too late. A repeat of the economically costly lockdown in spring must be prevented, said Gabriel Felbermayr, President of the Kiel Institute for the World Economy (IfW). However, the economic side effects of the measures must always be kept in mind.

Steel associations call for increased efforts to overcome the steel crisis
22 steel associations in the Americas, Europe, Asia and Africa have again called on the governments of steel-producing economies to intensify their work in the Global Forum on Steel Overcapacity. The scale and persistence of overcapacity in the steel industry would require more ambition in terms of the Forum's transparency and policy work. Non-participating governments should also participate again. Overcoming the global steel crisis is in the interest of all economies, steel producers and consumers and requires the commitment of all G20 economies.

Dominique Mayer