European recession further slowed global manufacturing – UN report

Global manufacturing output rose by merely 1.2 per cent in the fourth quarter of last year compared to the same period in the previous year, the lowest quarterly growth rate in the last three years, according to a United Nations report released today that attributes the slowdown to the prolonged recession in Europe and weaker growth in other industrialized countries.

According to the report by the UN Industrial Development Organization (UNIDO), the risk of another slowdown looms over developing economies as long as the economic recession persists in industrialized countries.

In industrialized countries, manufacturing output fell by 1.8 per cent compared to the fourth quarter of 2011, while the manufacturing output of developing economies grew by 7.6 per cent compared to the same period of the previous year.

In Europe, the decline in industrial production previously observed in a few countries of the European Union spread across the continent. Industrial production systematically decreased there in all four quarters of 2012, UNIDO reported.

Manufacturing output in the fourth quarter fell by 3.9 per cent in France, 2.9 per cent in Germany, 6.9 per cent in Italy and 1.8 per cent in the United Kingdom.

The severity of the crisis slightly eased in Greece and Portugal where there was a much lower declining rate. However, manufacturing output in Spain dropped significantly, by 6 per cent in the fourth quarter, according to the UN agency.

Growth in North America continued but at a lower rate than in the previous quarter.

In East Asia, manufacturing outputs dropped for the second consecutive quarter, mainly due to a decrease in Japanese exports.

Improved growth in China helped bolster figures in developing countries averting a further slowdown in the rate of manufacturing growth observed during the first half of 2012, UNIDO reported.