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Dramatic collapse of German industrial orders: Scholz seeks national unity

Collapse of industrial orders in Germany, and not something light and sweet, but dramatic, worthy of Bach's Toccata and Fugue. Where the escape refers to the German production capacity.

Industrial orders in Germany plunged 11.7 % month-on-month in July 2023, far worse than market estimates of a 4% drop and compared with June's upwardly revised 7.6% growth.

It was the first decline in industrial orders since March and the sharpest since April 2020, driven by weakness in large-scale orders, particularly in the manufacturing of aircraft and spacecraft.

New orders for other transportation equipment, related to the aerospace industry, fell by 54.5%, followed by those of computers, electronics and optics (-23.6%), machinery (-8.7%), equipment electricity (-16.7%) and finished metal products (-14.2%). On the other hand, orders for motor vehicles and their components grew by 2.7%.

Orders for capital goods fell by 15.9%, while those for intermediate and consumer goods fell by 4.5% and 8.2% respectively . Excluding large orders, new orders increased by 0.3%.

Foreign orders contracted by 12.9%, with declining demand both from the Euro Area (-24.4%) and from third countries (-4.1%), while domestic orders decreased by 9, 7%.

Here is the related graph of this disaster

The 24% drop from the Euro area is significant: having brought the EU into crisis with restrictive monetary policies, combined with environmentalist follies, does not bode well for German industry which is unable to conquer non-European markets.

Today in Parliament in Berlin Olaf Scholz , one-eyed , proposed to the Länder, the municipalities and the opposition a "Pact with Germany" to modernize the country. All government agencies should show more speed and courage to make the country more modern and safer from the ground up, according to a position paper presented in Wednesday's general debate in the Bundestag.

To significantly speed up the approval process, the federal and state governments will have to develop a comprehensive package of measures and launch them this year. This included speeding up general procedural law, digitizing planning and approval procedures, and simplifying housing construction. Large-capacity and heavy transport as well as major road and rail projects will also need to be simplified.

On the one hand, the hint of the relaunch of social housing could revive some construction, which is currently stagnant, but on the other, a simple question arises: what is the point of speeding up pre-procedures for large transports, if there is no demand for the same. What is the point of building trains and roads, which are necessary, given the disastrous state of German infrastructure, when the "debt brake" wanted by the liberals still severely limits spending? It is just the umpteenth political declaration, destined to remain without effect.

Speed ​​is useless for things no one wants to do, and the futuristic desire for speed will remain a buzzword.

In the first reactions, the Union has shown itself open to dialogue The regional group leader of the CSU, Alexander Dobrindt, said that the Union is ready for a similar "Pact with Germany", but under certain conditions. The country is in a situation in which “your offer should definitely be taken seriously,” the chairman of the CSU deputies in parliament said in the general debate. But a concession is needed on the refugee issue. “one of the most central crises currently in Germany”. The Union has a clear plan on how to deal with this situation. “You can immediately write it with us in the next week of meetings in a 'Pact with Germany' to address this crisis.”

The fact that the CDU CSU immediately said yes confirms that the contents, in the end, are empty, but also that the ground is now ready for a new Grosse Koalitione in Germany. A nostalgic choice, but times are no longer those of Merkel.

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The article Dramatic collapse of German industrial orders: Scholz seeks national unity comes from Scenari Economici .

This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/drammatico-crollo-degli-ordini-industriali-tedeschi-scholz-cerca-lunita-nazionale/ on Wed, 06 Sep 2023 15:08:44 +0000.