Talking point
Augmented reality: Fears should not completely overshadow the opportunities that beckon
Major trade events such as the upcoming CES for consumer technology and also the recently held Medica for healthcare are the showcases for augmented reality products available in the near future: dental implants that enable deaf people to hear; electronic gloves that convert sign language into text and smart glasses that display information about what or who is facing the wearer. These innovations are highly attractive, but also stoke fears – especially about potential privacy infringements. These fears definitely need to be taken seriously. They should not, however, be allowed to completely overshadow the potential of the myriad business and social opportunities that extend far beyond cutting costs and minimising the risks associated with particularly critical activities. [more]
Germany
Capital investment in Germany at sectoral level: Service providers continue to expand while industry contracts slightly
Germany's service sectors have shown themselves to be keener to invest than industry in recent years. The net fixed assets held by the service sectors grew by almost 28% in real terms between 1995 and 2012, although their growth rate has slowed over time. By contrast, the capital stock in the industrial sectors has shrunk by 1.6% in real terms. While, on the one hand, politicians in Germany have been expressing regret or even voicing criticism over the country's current lack of capital spending, on the other they have recently introduced measures (such as their policies on pensions and labour markets) that are hampering investment in Germany rather than stimulating it; this approach is inconsistent. [more]
Focus Germany
Focus Germany – Outlook 2015: Recovery with risks attached
Following a weak winter half in 2014/15 the economy looks likely to regain its footing as 2015 progresses. However, sluggish performance at the turn of the year means growth will probably average only 1% in 2015 after 1.4% in 2014. It is encouraging, however, that private consumption should remain a major pillar of growth, whereas net exports are likely to have a neutral impact. Nonetheless, signs are increasing that some – in our opinion misguided – economic policy moves (such as the introduction of a nationwide minimum wage as well as an enhanced pensions package) are weighing on the labour market and thus on consumption. Given a weakening of cyclical activity and the costs of economic policy measures, we expect the general government budget to be slightly in deficit in 2015. [more]
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