Future Perspectives

Economic Outlook

Economic Outlook

 

 

Growth1 2016

 

Growth forecast1 2017

Growth 2016 restated

1

Real growth of gross domestic product, source: IHS Global Insight

2

Including about 50 countries defined by IHS Global Insight as emerging markets in line with the World Bank

As of February 2017

World

 

+2.5%

 

+2.8%

European Union

 

+1.9%

 

+1.6%

of which Germany

 

+1.8%

 

+1.9%

United States

 

+1.6%

 

+2.3%

Emerging markets2

 

+3.8%

 

+4.0%

Slight increase in the pace of global economic development

The global economy will probably grow somewhat more quickly overall in 2017 than in the previous year. In the United States, particularly, we expect better economic development than in 2016. Private consumption will likely remain a key growth driver, as employment and disposable income will probably continue to increase. Positive stimulus will presumably also come from corporate investment. We expect a slight decline in growth in the European Union. Against the background of important elections in a number of countries, uncertainty over the future political development in Europe in particular is likely to hamper growth. In addition, there are unknowns associated with the United Kingdom’s exit from the European Union. On the other hand, we expect the expansionary monetary policy of the European Central Bank to have a continued positive impact. Economic output in the Emerging Markets will probably pick up overall compared with the previous year. We expect strong growth in China but at a slightly slower pace. Supported by rising raw material prices, Brazil and Russia will likely return to the growth zone after severe recession.

Moderate to declining industry forecasts

Economic Outlook for the Segments

 

 

Growth1 2016

 

Growth forecast1 2017

1

Bayer’s estimate; except pharmaceuticals. Source for pharmaceuticals market: IMS Health. IMS Market Prognosis.
Copyright 2016. All rights reserved; currency-adjusted; 2017 data provisional

As of February 2017

Pharmaceuticals market

 

+6%

 

+4%

Consumer health market

 

+4%

 

+3-4%

Seeds and crop protection market

 

−1%

 

+1%

Animal health market

 

+5%

 

+5%

We expect growth in the pharmaceuticals market to decline to 4% in 2017. This expectation is based on the assumption of continued positive stimulus from the United States. We anticipate low-single-digit percentage growth in Europe.

We also anticipate that growth of the consumer health market in 2017 will be roughly level with the previous year, at 3 to 4%. We expect similar market conditions to 2016.

We predict that the environment for the world seed and crop protection market will remain volatile in 2017 after a weak prior year. Growth stimuli are expected to come from Latin America, the Asia/Pacific region and Eastern Europe. In North America and Western Europe, on the other hand, the pace of growth will presumably lag behind global development. Overall we anticipate a slight recovery in the market as a whole.

Based on the continued positive development of innovative products in the animal health market, we expect the growth trend to continue in 2017. In the companion animals business, a positive performance is expected particularly in the United States and Europe. In the farm animals business, we expect the pace of growth in the Emerging Markets to pick up again slightly.

For 2017, Covestro expects a continuation of the growth trend in its main customer industries construction, electrical engineering & electronics, and furniture. However, growth in the automotive industry will likely be far weaker than in the previous year.