Prof. Dr. Lisandra Flach

Durch die vielfältigen Krisen der letzten Jahre hat sich das Misstrauen gegenüber der Globalisierung verstärkt. Lisandra Flach erklärt, welche Auswirkungen der Ausbau von Handelshemmnissen für die Weltwirtschaft und für ein Land wie Deutschland hat, das auf Freihandel angewiesen ist, und welche Maßnahmen die europäische Wirtschafts- und Handelspolitik jetzt ergreifen sollte, um diese Herausforderungen zu bewältigen.

Um den Klimawandel zu bekämpfen, müssen erneuerbare Energien und klimafreundliche Technologien weltweit möglichst schnell zur Verfügung stehen. Laut Andreas Baur und Lisandra Flach gibt es durchaus Argumente dafür, die Produktion solcher Technologien auch durch den Staat zu fördern. Das Ziel der Klimaneutralität muss an oberster Stelle stehen, während die Frage über den Produktionsort klimafreundlicher Technologien nur zweitrangig ist. Die Diversifizierung von Bezugsquellen ist der Erfolgsgarant für stabile Lieferketten und die Reduktion bedenklicher Abhängigkeiten. Eine merkantilistische EU-Handelspolitik wäre hierbei kontraproduktiv.

Lisandra Flach analyses the economic and political consequences of Brexit, which are proving to be increasingly dramatic.

Lisandra Flach und Andreas Baur erklären, warum ein Verzicht auf globale Lieferketten mit extrem hohen Kosten für die deutsche Wirtschaft verbunden wäre.

Die Zukunft der Handelspolitik braucht Mut und Pragmatismus.

Die Pandemie hat gezeigt, wie anfällig die weltweiten Lieferketten für Störungen sind. Das heißt aber nicht, dass nun wieder komplett in Deutschland produziert werden muss, meinen die Ökonomin Lisandra Flach und der Ökonom Martin T. Braml.

Auch ein US-Präsident Joe Biden würde eine protektionistische Handelspolitik betreiben. Aber es gibt doch einen bedeutsamen Unterschied zu Donald Trump.

It’s widely accepted that the decision of the UK to leave the EU imposes a key challenge for trade relations. The outcome of trade negotiations, which were resumed in an hour-long telephone call on Thursday after a week-long

Martin Braml und Lisandra Flach über die Probleme und Zukunft der WTO.

ifo trade expert Lisandra Flach recommends quickly concluding the free trade agreement between the EU and Mercosur in Latin America. “Ratification of the agreement is key for both Europe and Mercosur to broaden their supply chains and reduce dependence on China,” Flach says ahead of the EU-Latin America summit. China is now Mercosur’s most important trading partner, she adds, while the EU has become a great deal less important in recent years.

Since 2020, German industry has responded to disruptions in international supply chains primarily by making increasing use of warehousing. This is the finding of an ifo Institute survey, according to which 68 percent of the companies surveyed have increased the size of their warehouses, 65 percent have sought additional suppliers, and 54 percent now monitor their supply chains better than before.

The ifo Institute has called for a show of unity toward China. In recent years, the trade imbalance between Germany and China has tipped significantly in China’s favor, but the same is not true for EU-China trade relations, according to an ifo study. “For this reason, it is questionable whether Chancellor Olaf Scholz’s trip to China will on its own be enough to send the right message. It would have been a good opportunity to demonstrate European unity to Beijing,” says Lisandra Flach, Director of the ifo Center for International Economics. 

The vast majority of German companies have taken concrete action to adjust their supply chains since the coronavirus pandemic. This is a finding of an ifo Institute survey of 4,000 companies conducted in June 2022 and published by the EconPol Europe research network. The survey found that 87 percent of manufacturing companies have changed their sourcing strategy in response to supply chain disruptions. In wholesale, the respective share was 76 percent; in retail, it was 63 percent.

For many key technologies, such as battery technology, robotics, and renewables, Germany is dependent on imports of raw materials – often from individual supplier countries like China. “Urgent action is required to ensure that the supply chains for nine critical minerals – cobalt, boron, silicon, graphite, magnesium, lithium, niobium, rare earths, titanium – are crisis-proof. Additional sources of supply are needed to make the supply chains more resilient,” says Lisandra Flach, Director of the ifo Center for International Economics, in summarizing the findings of an ifo study conducted on behalf of the Chamber of Industry and Commerce for Munich and Upper Bavaria.

German economists would like to see EU tariffs imposed on energy imports from Russia. Such tariffs are an effective measure for reducing payments to Russia while also minimizing the impact on Europe’s energy supply, say 70 percent of the participants in the latest ifo and FAZ Economists Panel survey. They consider tariffs to be better than embargos and more effective than quantitative restrictions. Tariffs would force Russia to lower the export price. Participants also say higher prices in Europe would simultaneously lead to a redistribution of scarce resources via the free market. “This could be an effective way to put pressure on Russia,” says Lisandra Flach, Director of the ifo Center for International Economics.

Sweeping coronavirus restrictions in China have negative consequences for the German economy, finds an ifo Institute survey. Approximately one in two companies affected by material shortages reported that the lockdowns currently in place in China have made the situation even worse than before. The sector most affected is wholesale (67.3 percent), followed by retail (63 percent) and manufacturing (53.7 percent). “Industries such as automotive and chemicals as well as manufacturers of machinery and equipment and of electrical equipment, which are closely intertwined with the Chinese economy, have been hit the hardest,” says Lisandra Flach, Director of the ifo Center for International Economics. 

Almost half of Germany’s manufacturing companies are currently dependent on key inputs from China. Many of them want to reduce this dependence, finds an ifo Institute survey. “In German manufacturing, 46 percent of all companies say they source significant inputs from China. Of these companies, almost one in two is planning to reduce these imports from China in the future,” says Lisandra Flach, Director of the Ifo Center for International Economics. 

ifo President Clemens Fuest has warned of a price shock for oil and gas if Russia invades Ukraine. “Even if the supply of gas isn’t restricted, there would still be a price shock, at least temporarily. This would affect private households and industry in Germany in equal measure. Currently, we are forecasting an inflation rate of 4 percent for 2022. If war breaks out, it could be even higher.” 

Brexit has had an unfavorable impact on trade between the EU and the United Kingdom. According to figures from the ifo Institute, the UK’s share of EU27 goods exports fell from 6.2 percent in 2019* to 5.2 percent in 2021*, while its share of EU27 goods imports fell from 3.9 percent to 2.6 percent over the same period*. 

Relocating international production back to Germany would reduce German economic output by almost 10 percent, finds a study in ifo Schnelldienst. “Bringing outsourced portions of value added back to Germany would mean that less competitive activities suddenly gain large shares in the mix of German value added. The associated drop in productivity would weaken the country’s economic performance,” says Lisandra Flach, Director of the ifo Center for International Economics and coauthor of the study.

Despite the coronavirus pandemic, only a few companies in Germany have turned to new national supply chains and are looking to replace global procurement. This is the finding of an ifo study for the Konrad Adenauer Foundation. Of the 5,000 companies surveyed, only one in ten intends to rely more heavily on domestic supply chains in the future.

The ifo Institute has spoken out against a general relocation of production back to Germany and against government intervention in supply chains. Instead, the sources of supply for the German economy ought to become more internationally diverse. Achieving this calls for a deeper European Single Market and a stronger World Trade Organization. These findings are from an article in ifo Schnelldienst by Lisandra Flach, Director of the ifo Center for International Economics; the article was published in advance on Friday.

German companies expect more bureaucracy as a result of the Supply Chain Act, or Lieferkettengesetz, according to the ifo Business Survey for May. “In manufac-turing in particular, 43 percent of participating companies say they expect nega-tive effects from increased bureaucracy or documentation requirements. The next largest percentage was in wholesale,” says Lisandra Flach, Director of the ifo Center for International Economics.

Europe has lost importance as a trading partner for the Mercosur countries, concludes an ifo Institute article that takes stock of the South American economic alliance on its 30th anniversary. “With China’s rise, trade flows shifted away from Europe to the Chinese market. As a result, Mercosur’s imports and exports to and from Europe are declining overall. Mercosur exports to Europe fell by almost 25 percent in the past six years alone,” says Lisandra Flach, Director of the ifo Center for International Economics and one of the article’s authors.

Lisandra Flach, the Director of the ifo Center for International Economics, called the upcoming election of a new director-general for the World Trade Organization a “unique opportunity.” After the difficult Trump years, she said, there is now a chance to breathe new life into international trade negotiations and achieve a more stable system that is not based on unilateral relationships. Trust must be rebuilt, Flach said in Munich on Monday.

Le Brexit affectera le Royaume-Uni plus durement que l'Union eu-ropéenne. C'est ce qui ressort de l'analyse des chiffres du commerce bilatéral par l'Institut ifo. Ces chiffres montrent que la part de l'UE dans le bilan commercial du Royaume-Uni est beaucoup plus grande que l'inverse, y compris pour les produits fournis par un nombre restreint de fabricants. « Les deux parties seront perdantes à cause du Brexit, mais le Royaume-Uni le sera beaucoup plus. Un accord commercial pouvant entrer en vigueur le 1er janvier prochain serait dans l'intérêt des deux acteurs », estime Lisandra Flach, directrice du Centre d'économie internationale de l'Institut ifo.

Brexit will hit the UK harder than the EU, according to an ifo Institute evaluation of trade figures between the two. These show that the EU’s share of the UK’s trade is much larger than the other way around. The same is true for products of which there are only a few suppliers. “Brexit means both sides lose, but the United Kingdom loses considerably more. It is in both parties’ interests to have a trade agreement in place as of January 1,” says Lisandra Flach, Director of the ifo Center for International Economics.

Joe Biden becoming US President offers an opportunity to ease worldwide tensions and uncertainties in trade and to secure the future of the World Trade Organization. This is the position taken by Lisandra Flach, Director of the ifo Center for International Economics, in a recent guest article in Handelsblatt. “Biden is no champion of free trade. There is a great deal of protectionism to be found in the Democrats’ election platform, too. However, Biden believes in cooperating with international institutions. This is a clear difference from current US President Donald Trump,” she says.

Brexit could hit UK companies particularly hard. This is the finding of a study conducted by the ifo Institute and the EconPol Europe research network. The reason is that UK companies import many intermediate products from the EU, sourcing them from few suppliers. “The current Covid-19 crisis has shown how important it is to diversify supply chains in order to mitigate the negative effects of unexpected supply shocks,” says Lisandra Flach, Director of the ifo Center for International Economics.

Les entreprises du Royaume-Uni pourraient être particulièrement affectées par le Brexit, indique une étude réalisée par l'Institut ifo et le réseau de recherche EconPol Europe. Pour quelle raison ? Les entreprises britanniques importent beaucoup de produits intermédiaires achetés auprès d'un petit nombre de sous-traitants basés dans l'Union européenne. « L'actuelle crise de la Covid-19 a démontré qu'une diversification des chaînes logistiques est essentielle pour atténuer les effets négatifs de ruptures d'approvisionnement imprévues », explique Lisandra Flach, directrice du Centre d'économie internationale de l'Institut ifo. 

The call for a less integrated world expressed in the wake of the coronavirus pandemic would lead to a loss of income and prosperity. This is according to a recent study by the ifo Institute. “Rolling back globalization, for example by bringing production back to Germany on a larger scale, would not be a solution to the current crisis,” says Lisandra Flach, Director of the ifo Center for International Economics.