NRW economy between hope and fear: mini-growth in sight!

NRW economy between hope and fear: mini-growth in sight!

According to a current forecast from the RWI - Leibniz Institute for Economic Research, the economy in North Rhine-Westphalia is facing a mixed future. The second economic report was presented in Düsseldorf on Monday, analyzing the country's economic situation and prospects. President of the IHK NRW, Ralf Stoffels, describes the situation in many companies as “between hope and fear”. Although it was possible to prevent the economy from slipping further in early summer, the competitive situation remains unpredictable, particularly in an international context.

For 2023, the RWI expects a minimal increase in economic output in North Rhine-Westphalia of 0.1 percent. This represents a positive development compared to a decline of 0.4 percent in the previous year. However, this growth remains behind the national average of 0.3 percent. In February 2023, NRW's gross domestic product was originally forecast to grow by 0.3 percent, which underlines the uncertainties in the economic situation.

Stability despite challenges

However, the industry in North Rhine-Westphalia is showing increasing stability, even if it continues to suffer from the pressure of high energy prices and international competition. NRW Economics Minister Mona Neubaur is demanding competitive energy prices from the federal government in order not to endanger the upswing. She emphasizes the need for a temporary bridge electricity price and a reliable power plant strategy.

A much more positive outlook is emerging for 2026. The RWI expects economic growth of 1.5 percent both in North Rhine-Westphalia and throughout Germany. This value is at the same level as the nationwide forecast. Torsten Schmidt, economic expert at RWI, explains that the outlook for economic development in NRW has improved. However, he points to ongoing geopolitical risks and the threat of higher tariffs on exports to the US, which continue to be monitored with concern.

Federal support as a source of hope

The federal government's greater scope for spending has contributed to the positive adjustment of this outlook. Schmidt expects stimulus of up to 0.5 percent of gross domestic product per year in the coming years. It is expected that the federal government's special fund will provide noticeable impetus to expand economic output. This support could be crucial to improving the tense economic situation in North Rhine-Westphalia.

The comprehensive analysis reveals the challenges and opportunities of the North Rhine-Westphalian economy and leaves room for both optimism and critical consideration of the prevailing uncertainties. The coming period will show whether the government's measures and the adjustments in the industry are sufficient to promote a sustainable economic recovery.

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