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METRO GROUP : ANNUAL REPORT 2010 : BUSINESS
→ GROUP MANAGEMENT REPORT : 2. ECONOMIC PARAMETERS
A global economy in upswing
The global economy developed positively in 2010, recovering
somewhat from the impact of the economic and financial
crisis. Nearly all countries in which METRO GROUP does
business returned to the growth path. however, the strength
of the recovery varied across regions: while the Asian developing
economies experienced strong growth, the picture
was mixed in Europe. Some countries grew dynamically,
whereas others continued to struggle with various problems,
above all excessive public debt burdens.
The global economy recovered on the back of expansive
monetary and fiscal policies and the strong import demand
from the Asian developing economies. Around the world, the
tangible recovery witnessed during the first six months
slowed as the year progressed, although Asia still remained
the world’s fastest-growing region. The reasons for the
slowdown during the second half of the year included the
gradual withdrawal of national and international stimulus
measures and the introduction of partly draconian austerity
measures as part of budget consolidation in several countries.
In 2010, the western and Eastern European economies, in
particular, fell short of the economic output levels of the
pre-crisis year 2008 – despite generally favourable developments.
Germany
Germany was western Europe’s economic engine in 2010,
experiencing record growth of 3.6 percent. Exports were the
strongest growth driver during the first half of the year. But-
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2. Economic parameters tressed by favourable labour market trends and increasing
disposable income, private consumption also profited from
the upswing during the second half of the year, albeit rela-
Development of gross domestic product
in key global regions and Germany
Percentage change year-on-year
2010 2009
Asia 6.9 –0.2
world 4.1 –2.1
Germany 3.6 –4.7
Eastern Europe 2.9 –5.8
western Europe excl. Germany 1.3 –4.0
Source: FERI
tively less than in other areas. After accelerating to a record
pace in the second quarter, economic growth weakened
somewhat during the latter half of the year. Nonetheless,
the German economy’s growth momentum remained robust.
At an annual average of slightly over 1 percent, inflation
remained at a low level, but trended upwards towards the
end of the year.
Western Europe
Compared to Germany, the economic recovery progressed
markedly more slowly in the other countries of western
Europe. Although western Europe as a region profited from a
growing export momentum, the economic recovery did not
gain a solid footing. After shrinking by more than 4 percent in
2009, the western European economy excluding Germany
grew by less than 1.3 percent in 2010, with the regional average
concealing stark divergences among different markets.
In particular, high public debt burdens and government austerity
measures proved a heavy burden on some countries.
For example, the Greek economy remained in recession in
2010. The same applies to Spain, which continues to struggle
with the effects of its domestic real estate crisis. Growth
momentum in Italy and Portugal also remained below the
western European average. Meanwhile, such countries as
Sweden, denmark, Switzerland and Belgium developed positively.
Growth rates in France and the United Kingdom
matched the western European average.
Inflationary pressures in western Europe remained moderate
during the first half of 2010, before pointing upwards
during the second half of the year. Rising global market
prices for energy and other commodities were the key driver
of the increase in consumer prices. Food prices also showed
an above-average increase.
Eastern Europe
The speed of economic recovery also diverged markedly across
Eastern Europe. Turkey experienced an impressive upswing,
and Russia also posted solid growth after its steep decline in
2009. Other countries continued to struggle with the effects of
the economic and financial crisis: Romania, Bulgaria and hungary,
in particular, managed no more than a sluggish recovery
amid ongoing public deficit problems. Following the steep
currency devaluations of 2009, most European currencies
strengthened somewhat versus the euro in 2010.