Volker Wieland calls for exit strategy from the economic standstill (NZZ, FAZ, Tagesschau)

The German Council of Economic Experts (GCEE) has analyzed the economic impact of the corona crisis in a special report. "The longer the restrictive measures go on, the more fundamental the changes in the economic structure will be", Wieland warned. Therefore, in his opinion it is essential to prepare an exit strategy.

According to the special report, the first priority is to enable the health system to provide adequate care to patients and to limit the spread of the virus. In the baseline scenario with a confinement of five weeks and two weeks of recovery - the most likely scenario givén currently available information - GDP would shrink in the second quarter, similar to the financial crisis. In 2020, GDP would grow by -2.8 percent.

The first risk scenario with a confinement of seven weeks and five weeks of recovery, a pronounced V, would result in a drop in GDP of -5.4 percent. In 2021, the economy would then grow by -4.9 percent. If the restrictive measures last beyond the summer, a risk scenario in the form of a long U, the GCEE expects far-reaching damage to the economy resulting from bankruptcies and layoffs. This would also result in a drop in GDP. Next year, however, economic output would only grow at a very slow pace of 1.0 percent.

Therefore, in interviews with "Frankfurter Allgemeine Zeitung" and "Neue Zürcher Zeitung", Wieland asked the government to keep control in such an extreme situation and, in accordance with epidemiologists, prepare an exit strategy. The Federal Government's broad package of liquidity support, tax deferrals and guarantees was useful, he argued.


FAZ.NET: "Die Spanische Grippe hatte nochmal ganz andere Auswirkungen" (€)
Neue Zürcher Zeitung: "Wir brauchen eine Ausstiegsstrategie"
Spiegel.de: Wirtschaftsweise machen Hoffnung
Tagesschau vom 30.03.2020, 15-Uhr-Sendung

heute-Nachrichten 30.03 19-Uhr-Sendung

Read the Special Report (PDF overview)