Macroeconomic and sector-specific parameters¹

In financial year 2021/22, the global economy was revived by the continued recovery from the Covid-19 pandemic; however, starting in H2, it was also impacted by Russia’s war in Ukraine. Consequently, the pre-pandemic economic level was exceeded. The global economy developed less dynamically compared to the previous year (cf. table ‘Development of gross domestic product by region’). Growth in Germany was as high as in the previous year. High growth above previous year’s level was recorded in the region West. The economy in the region East grew even stronger than in the region West. However, the growth rate was slightly below that of the previous year. The Russian economy, on the other hand, declined slightly.

Private consumption was a major growth driver. After the restrictions to contain the pandemic were largely eased or even lifted completely, many consumers caught up on postponed consumption from previous years. This trend especially benefited the hospitality and tourism industries, with sales nearly returning to pre-pandemic levels and in some cases even exceeding them. Throughout the year, consumption patterns in the Eurozone returned to the multi-year average before the pandemic. This development highlights the fundamental resilience of private consumer spending. Furthermore, it shows that Covid-19 has not yet resulted in any significant or lasting change in consumer preferences.

After 2 negative years, the hospitality industry recorded very high growth rates, especially in Germany and Western Europe. Sales in these regions returned to between 85% and 95% of the level of the last year before the pandemic. Conversely, sales in this industry sector were already above this level in many countries in the region East. This is attributable to the fact that the Covid restrictions here were generally less strict than in Western Europe. Consequently, the growth momentum was not quite as high as in Western Europe due to the base effect compared to the previous year.

In the second half of the financial year, the economic and sector-specific parameters were increasingly influenced by the geopolitical situation. As a result, the business climate cooled down and consumer confidence dropped significantly. One of the main reasons for this was a sharp surge in prices, especially for energy, which originated with Russia’s war in Ukraine and the resulting downward spiral caused by sanctions. Furthermore, with a good order situation and high demand, global supply chains did not fully regain their pre-pandemic equilibrium. This intensified the inflation development, which, among other things, affected food prices.

To relieve the burden on companies and private households and to contain inflation, many countries introduced economic policy measures, such as price caps for energy and other basic goods, tax relief measures or targeted heating cost subsidies. The increasing escalation of the war in Ukraine led to Russia’s gradual economic isolation from the EU countries. Moreover, due to the continuation of the war, the programmes launched by the governments only provided limited relief for companies and private households.

The following table shows the development of the GDP by METRO region.