W. German economic forecast shows a pickup
Maybe the West German economic miracle is still functioning after all. Certainly the economic indicators look better than they did half a year ago. The Paris-based Organization for Economic Cooperation and Development (OECD) forecasts a 2 percent recovery of West Germany's real growth in gross national product for 1982. This comes after this year's estimated drop in GNP -- the output of goods and services -- of 1.5 percent. It also predicts investment recovery at only a minus 1.5 percent, compared with this year's negative 5 percent.
The OECD further expects inflation to fall from the current 5.5 percent to 4 percent, and the external current-accounts deficit to fall an impressive two-thirds from the estimated $17 billion in 1981 to $5.25 billion in 1982.
It sees West Germany's trade unions acting rationally in a recession period. This year the unions accepted modest raises slightly under the inflation rate. The OECD does expect unemployment to rise to 5.75 percent of the work force, however, up from this year's 4.75 percent.
West Germany's own independent council of economic experts paints a gloomier picture. After finally convincing everyone concerned of the need for belt tightening in this fall's 1982 budget, it's no wonder that the council is not too eager to hear too much good news to soon.
So unfavorable is the situation, the "five wise men" of the council believe, that they have issued an unusual special report to say so. They agree with the OECD that the overall economy and exports should pick up next year. But they think the government is erring in failing to take vigorous measures to curtail public spending and current-accounts deficits.
The OECD bases its trade optimism in part of the weakened deutsche mark; the dollar currently stands at a five- year high of 2.44 DM. This makes West German exports more appealing and -- given the already solid West German reputation for reliability and quality -- should quickly bring in new orders.
But the May export orders are disppointing, dashing hopes that export-led recovery might already have begun this past spring. May export orders were down 10 percent from the healthy April figures. Domestic demand was also weak in April and May, down 2 percent from the previous year; and April-May industrial output fell in sectors other than capital goods and foodstuffs.
In formulating its relatively optimistic prognosis, the OECD pointed out that fixed-asset investment has been higher in West Germany than in most Western countries in the past five or six years. It also noted that structural adjustment to oil price rises has been prompt.
As usual, part of the difference between the rosier OECD outlook and the darker council of economic experts' outlook lies in the distinctive domestic and international vantage points. Those on the inside compare present problems with past West German successes. Those on the outside compare West Germany's better coping with present problems wi th other countries' less successful efforts.