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Trump has failed with his campaign promises to achieve complete revitalization of the US manufacturing industry. His economic policy has not led to any substantial improvement. Even the industries that enjoyed particular protection by the Trump administration's trade policy are not showing extraordinarily strong developments. In the automotive industry, the situation has actually deteriorated somewhat.

Germany's financial contribution to global security within NATO is higher than often criticized by US President Trump. This is because NATO members, especially the US, are increasingly pursuing geostrategic goals not only by using or threatening to use armed force, but also with the help of economic sanctions. In European countries, especially in Germany, these sanctions cause high costs, whereas in the US they hardly cause any harm.

During the peak phase of the corona pandemic, Chinese exports of critical medical goods such as protective masks went primarily to economic and political partners. Chinese companies were able to push through drastic price increases against industrialized countries like Germany. "In order to secure their supply of critical medical goods, countries are well advised to diversify their sources of supply or develop close relations with China's provinces, for example through local investments or city and province partnerships," said Andreas Fuchs, head of the Kiel Institute China Initiative

The corona pandemic leaves substantial marks in the German economy and its impact is more persistent than assumed in spring. In their autumn report, the leading German economic research institutes have revised their economic outlook downwards by roughly one percentage point for both this and next year. They now expect gross domestic product to fall by 5.4 percent in 2020 (previously -4.2%) and to grow by 4.7 percent (5.8%) in 2021 and 2.7 percent in 2022.

The Kiel Institute for the World Economy (IfW Kiel) is expanding its research and consulting activities on international development by appointing a new professor and expanding its Africa focus. Tobias Heidland (né Stöhr, 34) will take over as head of the research center "International Development" at the Kiel Institute and assumes a professorship in economics at the Christian-Albrechts-Universität zu Kiel (CAU) on October 1, 2020.

The economic upturn in Germany is losing momentum, after a rapid recovery following the end of the Corona lockdown. Researchers at the Kiel Institute for the World Economy expect gross domestic product to fall by 5.5 percent in 2020. This means that the slump this year will be 1.3 percentage points lower than feared in the summer. However, they now expect growth of 4.8 percent next year instead of the 6.3 percent in their previous forecast. Ongoing restrictions for some industries (e.g. travel) and weaknesses in the global economy in general is slowing down the recovery.

Governments that successfully contain the pandemic and adopt strict countermeasures are the big winners of the Corona Crisis—with approval rates increasing by more than 7 percentage points since February 2020. In comparison, governments that follow loose pandemic policies to limit economic damage perform significantly worse in terms of public support, especially when Covid-19 cases continue to rise. The data show that infection numbers are the main driver for government approval in recent months, with a larger impact than economic indicators. This is the result of a first wide-ranging study on the political impact of the Corona crisis that uses a new dataset from 35 countries for January to July 2020.

Trade relations between Africa and Asia, especially China, increase the prosperity of African countries. This is because they have been able to increase the value added of their exports and also export more to the rest of the world. Moreover in many African countries, China is not the most important trading partner at all, but other Asian countries, especially India.

In the second quarter of 2020, economic activity in the more than 5,000 Free Zones (or Special Economic Zones) worldwide is severely affected by the COVID-19 pandemic. This is the result of the latest F-WEB, a quarterly survey conducted by the Kiel Institute in cooperation with the World Free Zones Organization. The index value for economic sentiment has fallen drastically from +48 to -20 since February—registering a negative value for the first time since the launch of the survey. The expectations index for the coming three months is also considerably lower than in the previous quarter. Nevertheless, initial cautious optimism can be seen particularly in Asian Special Economic Zones.

On average, populist governments record significantly lower increases in popularity in the Corona crisis than non-populist ones, even though they usually introduced similar policies to contain the pandemic. At the same time, however, populists are making greater use of emergency laws to weaken democratic competition and institutions in their country, according to an evaluation by researchers at the Kiel Institute. In the long run, the success of populist governments is likely to depend on the economic consequences of the crisis and whether emergency legislation is withdrawn once the pandemic ends.

Global inter-state lending to tackle the corona crisis could reach record levels, exceeding the huge international financial assistance after 2008. The planned 750 billion euro Corona Reconstruction Fund of the European Union is historically common practice, especially between closely interconnected states. This emerges from an empirical analysis by the two IfW researchers Christoph Trebesch and Sebastian Horn with the new World Bank Chief Economist Carmen Reinhart, in which they evaluated financial flows between states from 1790 to the present.

The economic impact of the Covid 19 pandemic can be quantified with increasing reliability. In its regular summer forecast, the Kiel Institute now estimates the economic slump for 2020 at 6.8 per cent, and next year the growth rate should be 6.3 per cent. The German government's economic stimulus package does not significantly shape the picture, as it largely misses the core of the crisis. The global weakness in investment is having a negative impact on the export business. At the top of the labour market, one million jobs are lost. As a result of the crisis, Germany's current account surplus will fall to below 5 percent.

The Kiel Institute investigates negative emission technologies with regard to their economic and social potential in cooperation with GEOMAR and 12 other institutions.

Taiwan and South Korea have so far come through the corona crisis much better than many other economies. The keys to success have included pandemic-experienced and efficiently acting authorities, excellent medical care and research, and the use of digital tracking technologies. In the international competition for foreign capital, which is likely to intensify after the Corona crisis, Taiwan and South Korea have gained an advantage through their crisis-proven competencies, according to a recent Kiel Institute analysis.

The outbreak of COVID-19 could drive Iran into economic and political chaos. US sanctions have substantially weakened the country. Export restrictions, as imposed e.g. by the EU, are now impeding access to urgently needed medical products. Diplomatic tensions might rise and jeopardize cooperation, concerning e.g. the nuclear deal, if the EU hesitates to act.

Reducing irregular migration from Africa to Europe is one important objective of the new European Commission in its relations with many African countries. The Commission and EU member states need to acknowledge that effective migration management depends on the full and active cooperation of countries of origin and transit. Therefore, agreements on international mobility need to truly reflect both sides’ interests, concerns, and political limitations. More legal opportunities for labor migration from Africa to Europe will need to be a key element of effective joint migration management.

A survey conducted by the Kiel Institute among the approximately 5,000 special economic zones worldwide provides evidence of drastic economic losses as a consequence of the corona pandemic. This is further indication of the increasing risk of severe recession in emerging economies or even sovereign defaults.

The coronavirus pandemic is triggering a severe recession in Germany. Economic output will shrink by 4.2 percent this year. This is what the leading economics research institutes expect in their spring report. For next year, they are forecasting a recovery and growth of 5.8 percent.

Since the 1970s, European countries have repeatedly issued community bonds on the private capital market. The bonds were guaranteed by the member states and distributed to countries in crisis. Coronabonds, as currently discussed, would therefore be part of a long tradition of European solidarity and liability. Community bonds have proved their worth in past crises and have always been fully repaid.

Compared to the spring forecast of the Kiel Institute a week ago, the economic situation has worsened dramatically weighing heavily on economic prospects. The Kiel Institute has therefore updated its economic outlook based on two scenarios: A six-week lockdown (V-shape scenario) and a three months longer lockdown (U-shape scenario). In both scenarios the slump in GDP is considerable ranging from 4.5 to 9 percent for the current year, followed by a strong rebound next year.

The Kiel Institute for the World Economy sees the uncertainty about actual coronavirus case numbers as a major problem for appropriate political decisions and therefore proposes representative sample tests rather than testing special groups only. Ideally, thousands of people throughout Europe should be regularly subjected to a broad-based test, in parallel with other measures taken to combat the disease, in order to obtain statistically representative and comparable data. This is crucial to prepare guidelines for the end of the crisis mode.

As a consequence of the corona virus, the Kiel Institute expects a severe economic slump, followed by a strong rebound. GDP in Germany is expected to shrink by 0.1 percent in 2020 and will then grow by 2.3 percent in 2021. Such an economic V-effect is also expected for the euro area and the global economy. The government budget turns from a slight surplus this year into a slight deficit next year.

The introduction of a European Union financial transaction tax at a rate of 0.2 percent can generally be supported. However, the concept laid out by Germany and France has serious weaknesses that would limit revenue, discriminate against traditional equity Investment, and create incentives to circumvent the tax, according to the conclusion of an expert opinion by Kiel Institute.

German exporters will be particularly affected from the implementation of the Phase I trade agreement between the USA and China which has now come into force. As a result of trade diversion, Germany’s exports of goods to China are likely to fall by almost 4.5 billion US dollars next year, especially in industries such as vehicles, aircraft, and industrial machinery. Only Brazil’s soybean farmers will be hit harder. This is shown by calculations made by the Kiel Institute.