December 2022 INDUSTRIAL POLICY DOSSIER
Industry Report Industrial production and trade in the individual industries
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Production levels in manufacturing remain stable this year thanks to consistently high order backlog. The BDI expects manufacturing output to rise by a marginal 0.25 percent this year, following a rise of 4.7 percent last year. The outlook for 2023 is bleak. More and more manufacturing enterprises are struggling with the high energy prices and geopolitical uncertainties.
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Production in energy-intensive sectors sank from January to September. The drop amounted to 2.3 percent in the metal-producing and processing firms, 3.7 percent among manufacturers of rubber and plastic products 3.7 percent, and a significant 8.2 percent in the chemical industry. The strongest growth was recorded by other transport equipment (up 6.5 percent), electrical and electronics (up 4.2 percent) and the pharmaceutical industry (up 3.8 percent).
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In the European Union, industry has continued its recovery during the third year after the outbreak of the Covid pandemic. Another year of sizeable expansions of production in pharmaceuticals together with strong growth in mechanical engineering are propping up industrial activity.
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In 2022, German exports will rise by just 2.5 percent overall following price adjustment (2021: up 9.7 percent), according to our estimates. German foreign trade has suffered considerably from supply bottlenecks and the uncertainty caused by the outbreak of the war in Ukraine is further exacerbating the situation.
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We expect world trade in 2022 to rise by four percent. The export of goods from emerging countries is set to rise much more steeply than from advanced economies.