Annual Report 2022

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Economic Outlook

Global Economy

Compared with the reporting year, under the weight of the continuing Russian war against Ukraine, the global economy is expected to experience persistently high inflation, further tightening of monetary policy, and weaker – yet slightly positive – growth in the year 2023. Our growth forecast for the year 2023 is 1.5%. Most of the leading industrialized countries are expected to fall into a mild recession in fiscal 2023. The relaxation of the zero-COVID policy in China offers opportunities for improved global growth prospects, but also risks if there are high rates of infection.

Economic growth1








Growth 2022


Growth1 forecast 2023











Europe, Middle East, Latin America2, Africa (EMLA)





of which Europe





of which Germany





of which Middle East





of which Latin America2





of which Africa





North America3 (NA)





of which United States





Asia-Pacific (APAC)





of which China






Real growth of gross domestic product; source: Oxford Economics, as of February 2023.


Latin America (excluding Mexico).


North America (Canada, Mexico, United States).

We believe growth in the EMLA region will underperform the global pace. High inflation and the continuing energy crisis make a recession likely in Europe. Germany’s export-oriented economy should see negative growth of 0.2% in the year 2023. In the Middle East, growth will likely outperform the global economic expansion. The oil industry is anticipated to be a driver of this development, with oil prices expected to persist at a high level for the time being. We anticipate that growth in Latin America will fall below the global level, because weaker global demand and tighter domestic policies are likely to have a negative effect on economic stability. In Africa, we forecast economic growth to outpace the global growth rate.

For the NA region, we anticipate a mild recession. In the United States, significant increases in the federal funds rate will lead to a continuing rise in the cost of borrowing and therefore weigh on companies’ profits and capital expenditure. Consumer spending is likely to decline because of higher unemployment. Against this backdrop, we expect the United States to generate economic growth of 0.0% in the year 2023.

Economic growth in the APAC region will likely outperform the global economy. We anticipate economic growth of 4.5% for China in fiscal 2023. The relaxation of the zero-COVID policy and economic stimulus measures taken by the government in China should lead to a gradual recovery of macroeconomic performance in the region, even though risks to economic performance remain in the case of higher infection rates.

Main Customer Industries

In 2023, we forecast growth of 4.6% for the global automotive industry. High order backlogs will again counteract an economic downturn in the industry in the year 2023. Growth will likely be driven by the EMLA and NA regions, while the APAC region is expected to have only slightly positive growth.

We anticipate positive expansion of 0.8% in the global construction industry in the year 2023. Poor economic growth, the high cost of construction materials, labor shortages, and rising inflation will continue to weigh on the construction industry in the year 2023. We anticipate slightly positive growth for the APAC region, while the growth rate will be stable in the EMLA region and slightly negative in the NA region.

In the year 2023, we anticipate that the global electrical, electronics, and household appliances industry will grow by 2.0%. Due to shifts in consumer spending from goods to services, weak demand for electronics and electrical components is expected to continue in fiscal 2023. We anticipate negative performance for the EMLA and NA regions and slightly positive growth rates for the APAC region.

In 2023, we anticipate positive growth of 0.3% for the global furniture industry. High inflation, rising selling prices, a slowdown in consumer demand, and lower investments in the housing sector will again have a dampening effect on growth prospects in the year 2023. We anticipate negative performance for the EMLA and NA regions and slightly positive growth rates for the APAC region.

Growth in main customer industries1








Growth 2022


Growth forecast 2023
















Electrical, electronics and household appliances











Covestro’s estimate, based on the following sources: LMC Automotive Limited, B+L, CSIL (Centre for Industrial Studies), Oxford Economics. We limited the economic data of our “automotive and transportation” and “furniture and wood processing” main customer industries to the automotive and furniture segments (excluding the transportation or wood processing segments). As of: February 2023.

Comprises all countries in the Asia and Pacific region.
Comprises all countries in Europe, the Middle East, Latin America (excluding Mexico), and Africa.
NA / North America
Region comprising Canada, Mexico, and the United States.

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