Comment
Information and communication | Employment | ICT | Employment growth

According to data released today by Eurostat, the European Statistical Office, the number of information and communication technologies (ICT) specialists in the EU rose by almost 1.5 million people in the period between 2011 and 2015. Germany, in particular, saw a significant increase. This development was also confirmed in the recently published Monitoring Report DIGITAL Economy 2016, in which Irene Bertschek, head of ZEW's Research Department "Information and Communication Technologies", was actively involved. With regard to the development of ICT specialists in Germany she finds that,

Information Economy
ZEW ICT Survey | Information Services | ZEW survey
The ZEW Economic Sentiment Indicator in the German Information Economy reaches a level of 68.9 points in the third quarter of 2016.

In the third quarter of 2016, the economic sentiment among companies in the German information economy remains positive. The corresponding ZEW Economic Sentiment Indicator, which had already closed at a high level in the previous quarter, continued its growth by climbing an extra 3.4 points, reaching a total of 68.9 points. This suggests that a vast majority of the companies evaluates the economic situation of the information economy positively. This is the result of a survey among companies in the German information economy, conducted by the Centre for European Economic Research (ZEW) in September 2016.

China Economic Barometer
ZEW survey | Macroeconomic performance | China | ZEW-PwC Indicator of Economic Sentiment China

German managers in China are more optimistic again regarding the current economic situation in the world's second largest economy. Following negative evaluations in four consecutive quarters, China's economic situation is for the first time judged more positively again. According to the surveyed managers, the likelihood of an economic slowdown to occur within the coming twelve months remains relatively high. With 33 per cent, however, it is significantly lower than in the previous survey (53 per cent).

Research
Brexit | Foreign trade risk | Länderindex Familienunternehmen
Brexit carries risks for several European countries in terms of foreign trade.

The imminent departure of Great Britain from the European Union won't affect Germany in terms of foreign trade as much as it does other economies, such as Belgium, Switzerland and the Netherlands. This is the result of a preliminary analysis in the latest Country Index for Family Enterprises, carried out by the Centre for European Economic Research (ZEW), Mannheim, on behalf of the Foundation for Family Businesses. The index shows that the pharmaceutical industry is the German sector that will be most affected by Brexit due to its high dependency on export. Several branches of the transportation industry – including aerospace and railway construction – are also considered vulnerable since they are exposed to high import risks.

Research
ICT | Germany | Corporate performance | Internet | Digitisation
Positive trend in Germany\\\'s Internet economy continues. Nevertheless, Germany remains in the midrange.

The German Internet economy generated a turnover of more than EUR 111 billion in 2015, which corresponds to a 9 per cent increase compared to the previous year. On a global scale, Germany's Internet economy ranks fifth in terms of turnover per capita, remaining in the midrange alongside with Japan and France. In 2015, EUR 1,379 per capita was invested in Internet-based goods and services in Germany. The highest turnover per capita was recorded in the UK (EUR 2,585), followed by South Korea (EUR 2,389) and the USA (EUR 2,352). These are the findings of the Monitoring Report DIGITAL Economy 2016, conducted by the Mannheim Centre for European Economic Research (ZEW) in collaboration with TNS Infratest, on behalf of the Federal Ministry for Economic Affairs and Energy.

Research
Fiscal Transfer | State finances | Public Debt | Debt | Fiscal policy
Growing optimism regarding the federal government\\\'s ability to remain within the debt limits.

A vast majority of the members of the German state parliaments is optimistic that the German government will be able to meet the requirements of the debt brake, which entered into force this year. In addition, a great number of parliamentarians is confident that their home states will remain within the debt limits, which will be binding for all federal states as of 2020. When it comes to their predictions regarding the ability of other German states to reach a balanced budget, however, the MPs are not quite so optimistic. According to their estimations, only Bavaria, Baden-Württemberg, Saxony and Hesse will be able to meet the requirements. These are the findings of a survey among members of all 16 German state parliaments conducted by the Mannheim Centre for European Economic Research (ZEW), in collaboration with the University of Mannheim in 2015–16. Compared with the results from a first, similar survey carried out in 2011–12, this year’s results indicate a significant increase in optimism regarding the central level's ability to remain within the debt limit but, surprisingly, not with respect to the states.

Comment
Reform actions | State finances | Fiscal Transfer | Federalism
The compromise on the 2020 Financial Equalisation Scheme between the government and the state parliaments won’t solve any of the central issues in the current system.

The German government and the state parliaments have adopted a resolution which foresees a revision of the Federal Financial Equalisation System. The new legislative framework will see the end of the "horizontal" model, which consists in redistributing tax revenues from financially strong states to financially weak states. Instead, the financial strength of the states will be largely offset at an earlier stage, namely by an initial distribution of value-added tax (VAT) revenues among the federal states. Professor Friedrich Heinemann, head of the ZEW Research Department "Corporate Taxation and Public Finance" at the Centre for European Economic Research (ZEW), takes a critical stance on the reform.

CH Indicator of Economic Sentiment
ZEW-CS-Indicator | Switzerland | Short-term forecast | Macroeconomic performance | Cyclical indicator | Business survey
The ZEW-CS-Indicator for the economic sentiment in Switzerland has risen for the second consecutive time to a current reading of 5.2 points.

The ZEW-CS Indicator for the economic sentiment in Switzerland has continued its rise in October 2016. Growing by 2.5 points, the index now stands at 5.2 points. The indicator thus continues the slight upward trend already seen in the previous month. The indicator for the current economic situation also recorded an increase, rising by 9.9 points to a current reading of 17.9 points. The ZEW-CS Indicator reflects the expectations of the surveyed financial market experts regarding the economic development in Switzerland on a six-month time horizon. It is calculated monthly by the Centre for European Economic Research (ZEW), Mannheim, in cooperation with Credit Suisse (CS), Zurich.

ZEW Indicator of Economic Sentiment
Business Cycle | Cyclical indicator | Short-term forecast | Germany | Business survey | ZEW Indicator of Economic Sentiment
ZEW Indicator of Economic Sentiment for Germany, October 2016

The ZEW Indicator of Economic Sentiment for Germany increased in October 2016. The index gained 5.7 points compared to the previous month, now standing at a level of 6.2 points (long-term average: 24.1 points). "The improved economic sentiment is a sign of a relatively robust economic activity in Germany. However, positive impulses from industry and exports should not distract from existing political and economic risks. In particular, the risks concerning the German banking sector are currently a burden to the economic outlook," comments ZEW President Professor Achim Wambach.

China Economic Panel
China Economic Panel | China | Cyclical indicator | Short-term forecast | Business survey | ZEW survey
Expectations for the Chinese economy have worsened further in September 2016 to a current negative reading of minus 4.1 points.

Expectations for the Chinese economy have again worsened in the current survey period (12/09/2016 – 28/09/2016). The CEP Indicator, which reflects the expectations of international financial market experts regarding China’s macroeconomic development over the coming twelve months, has slightly fallen by 2.2 points to a current negative reading of minus 4.1 points. The CEP Indicator therefore currently lies significantly below the long-term average of 5.5 points for the second consecutive time, seen in the period from mid-2013 to September 2016.

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