MNI BRIEF: Germany's Economy Contracts 5.0% in 2020

The Covid-19 crisis led to a sharp contraction of Germany's economy in 2020, declining by 5.0% on an annual basis. After 10 years of expansion the pandemic triggered a decline in GDP almost as sharp as seen during the financial crisis of 2008/2009, when the economy contracted 5.7% in 2009, data released Friday showed.

Destatis, the German stats office, noted that the industrial sector, which accounts for just over a quarter of the total economy, saw output fall by 9.7% on an annual basis. The industrial sector was particularly affected by the pandemic in H1. The economic downturn was particularly severe in the service sector where sector declines were often the largest on record. Trade, transport, accommodation and food services were among the sectors hardest hit by the crisis, falling by 6.3% in 2020. Against that, online trade surged in 2020 as a result of the pandemic.

The construction sector was largely unchanged through the crisis, rising by 1.4% on the year.