The cyclical upswing in Germany has been gaining perceptibly in momentum since spring 1997. Gross domestic product in real terms increased by an average annual 2.2 percent compared to 1996.
The impetus behind the upswing &endash; in spite of unsolved structural problems &endash; was caused by several factors. Exports were flourishing anyhow and were given an extra boost by gratifying developments in the economies of Germany's important trading partners and by improved corporate competitiveness. In particular, competitiveness in price terms had been definitely strengthened by corporate rationalisation efforts, by moderate pay deals and the depreciation in the value of the deutschmark, above all versus the dollar and yen. Thanks to the export boom, capacity utilization in industry was again at the above-average 1992 level.
Although the forces behind the upswing are extending gradually from foreign to domestic demand as well, not all engines are running as yet. For investment in construction, there is no improvement in sight, and growth in spending on equipment has so far been below the growth rates of earlier cycles. With the failure of the planned major tax reform, key impetus for a further boost to investment activity is conspicuous by its absence.
Even after seven years of reunification, the Eastern German economy has still not quite caught up with the West. The considerable lead in growth rates for the Eastern German economy of a few years ago is now much smaller. A sustained level of development has still not been reached. In 1997, a shortfall in percentage growth relative to Western Germany was noted for the first time. There is still a lack of some 2 million profitable jobs missing, and the unemployment rate of some 17 percent in 1997 was much higher than in Western Germany.
In 1997, German pulp mills produced 738 000 t of sulphite pulp to surpass the previous year's level by 8 percent. Germany imported 3.9 million t of pulp. Merely 360 000 t were exported.
1997 was a good year for the German paper industry. It was much better on the whole than had been expected at the start. Order intake for paper and board rose steadily in the course of the year and reached a record high in October. Corporate assessment of the situation improved accordingly.
In 1997, exports proved to be the chief mainstay of the paper cycle. Up 17 percent to 7.4 million tons, German exports were running at record levels. Since imports rose only slightly in view of the still modest domestic demand, the foreign trade balance for Germany's paper industry was in positive territory for the first time.
Dynamic export developments enabled the German paper industry to post an overall rise in output of 8 percent to 15.9 million t in 1997. This amounts to an increase of 1.2 million t relative to the difficult and rather atypical year of 1996. Paper consumption was up 2 percent to 15.8 million t. Accordingly, per capita consumption rose from 189 kg to 193 kg.
The positive quantity business in 1997 did not have a corresponding impact on sales, which rose by a disproportionately low 6 percent. The price index for paper and board again fell nearly 6 percent from the already weak 1996 price level, so that the price situation is still unsatisfactory, even if there have been some signs of a reversal in the trend for some paper grades since the fourth quarter of 1997.
In view of the good orders, the German paper industry entered 1998
with confidence. The intention announced by some firms to step up
their investment plans again following a phase of restraint is due to
the positive assessment of market developments.
Fibres for the production of paper and board
(1000 tons)
|
|
1997 |
1996 |
1997:1996 in % |
|
Chemical pulp for paper production Production - Exports + I + Imports = App.Consumption |
736 360 3 850 4 248 |
683 339 3 613 3 957 |
8 6 7 7 |
|
Mechanical pulp Production - Exports + Imports = App.Consumption |
1 220 10 56 1 266 |
1 133 9 53 1 177 |
8 11 6 8 |
|
Waste paper Collection - Exports + Imports = App.Consumption |
11 245 2 700 900 9 500 |
10 912 2 958 934 8 888 |
3 - 9 - 4 7 |
|
Fibres in total App.Consumption |
15 052 |
14 065 |
7 |
Paper and board (1000 tons)
|
|
1997 |
1996 |
1997:1996 in % |
|
Production - West Germany - East Germany |
15 930 14 608 1 322 |
14 733 13 541 1 192 |
8 8 11 |
|
Exports Imports App.Consumption |
7 403 7 293 15 820 |
6 342 7 080 15 471 |
17 3 2 |
|
Export Quota Import Quota |
46.5 % 46.1 % |
43.0 % 45.8 % |
|
The German forestry sector, represented by the German Forestry Council (DFWR), has suggested that the national mark of origin: "Wood from sustainable forestry &endash; Grown in Germany's forests" be further developed toward a European sustainability certificate. To this end, criteria are to be worked out to meet the six Helsinki criteria at operational level. The German pulp and paper industry advocates this development but international and social acceptance is necessary.
In October 1997, a German FSC working group was set up, though this has not made itself noticeable so far. Confirmation and recognition by official FSC bodies is hard to imagine, since some key players - forestry and the timber trade - are not represented in the group as yet.
Sustainable management of our forests is essential in order to preserve the forest's manifold functions for future generations. The method of forest management should be in accordance with the prevailing conditions and thus take into account the variety of forest communities world-wide. Regular care and maintenance are essential in order to obtain stable, natural and economically efficient forest stands as the objective of sustainable modern forest management. The small-dimensional wood found particularly in young forest stands with their high growth rates is largely purchased and processed by the pulp and paper industry. In this way, small-dimensional wood accounts for more than one-half of the timber required by the German pulp and paper industry. Through the sustainable use of timber as a raw material, the industry makes a significant contribution towards preserving the stability of the forest eco-system and its manifold functions.
In 1996, some 37 million m3 of wood was felled. A good one third of this was industrial wood. According to a study of the Federal Forestry and Timber Research Institute, the quantity felled could be increased again without violating the sustainability principle.
In 1996, the German pulp and paper industry consumed 3.6 million m3 of industrial wood and 3.8 million m3of sawmill by-products.
The construction of a new market pulp mill is currently being planned in Eastern Germany, the possible sites being Wittenberge (Brandenburg), Stendal and Zeitz (both in Saxony-Anhalt). Each of these mills would have a demand of some 2.5 million m3 of industrial softwood. Construction is likely to commence in 1998.
