UN report shows euro-zone financial crisis slowing global manufacturing
Global manufacturing output rose by 4.2 per cent in the fourth quarter of last year compared to the same period in the previous year, the lowest quarterly growth rate for 2011, according to a United Nations report released today, which attributes the slowdown to the financial crisis in Europe.
According to the report by the UN Industrial Development Organization (UNIDO), the world’s manufacturing output had an impressive start in the first quarter of 2011, indicating a recovery from the financial crisis of 2008-2009.
However, the rebound stalled in the second quarter, especially due to the deteriorating financial situation in the euro-zone countries.
The fourth quarter of last year had signs of a slowdown in manufacturing growth in developing countries, where for the first time after the financial crisis, the growth rate was below 10 per cent.
The strong performance in manufacturing in the transport and automotive industry in developing and industrialized countries was the main driver of overall growth last year, according to the report.
Overall growth in industrialized countries was estimated merely at 2 per cent for the fourth quarter. Trends in industrialized countries were mixed. While the growth prospects of European countries were weakened, industrialized countries outside Europe consolidated their positive performance.
Manufacturing output in the United States grew by 4.3 per cent in the fourth quarter, reflecting further consolidation of the industrial sector, compared to the same period during the previous year.
While Japan’s manufacturing growth declined in the fourth quarter, the manufacturing production of the Republic of Korea grew by 5.6 per cent.
The impact of the financial instability could be seen both inside and outside the euro zone. Manufacturing production fell in the United Kingdom and Switzerland. Greece saw a 14 per cent manufacturing decline in the fourth quarter.
In Spain manufacturing output also fell by 4.6 per cent, while Portugal saw a 3.6 per cent decline, with Italy recording a 2.6 per cent fall.
Germany’s manufacturing sector showed 3.7 per cent growth, while Austria’s output grew by 3.3 per cent, Belgian by 4.6 per cent and France’s by 2.1 per cent. Growth figures were less than one per cent in Finland, Ireland and the Netherlands.
High manufacturing growth was recorded in the Czech Republic with 5.2 per cent and Poland with 9.6 per cent, while Russia registered a 6.5 per cent production output.
The manufacturing output in developing countries grew at a rate of 9.2 per cent, with China’s especially robust at 13.1 per cent, compared to Argentina’s 3.4 per cent, India’s 4.1 per cent and Mexico’s 4.9 per cent. Output fell by 1.9 per cent in Brazil.