Siemens 2010 Annual Report Download - page 180

6 To our shareholders 21 Corporate Governance 49 Combined management’s discussion and analysis
50 Business and operating environment
78 Fiscal  – Financial summary
81 Results of operations
98 Financial position
110 Net assets position
113 Overall assessment of the economic position

Report on expected developments
and associated material opportunities
and risks
REPORT ON EXPECTED DEVELOPMENTS
Worldwide economy
According to the predictions of IHS Global Insight, the global
economy will expand more than % in real terms in both 
and , although GDP growth will continue to be markedly
faster in emerging markets than in the industrialized coun-
tries. The forecast for global economic growth in  is .%,
slowing slightly compared with the expected growth for 
of .%. For , IHS Global Insight is projecting global eco-
nomic growth of .%. When global growth estimates are ex-
amined at a regional level, significant differences in expected
growth rates emerge. Growth is expected to be considerably
more subdued in the Europe, C.I.S., Africa, Middle East region
and in the Americas than in Siemens’ third reporting region,
Asia, Australia. A growth rate of .% is predicted for Europe,
C.I.S., Africa, Middle East in , rising to .% in . The
growth forecasts for the Americas region are .% in  and
.% in . Although growth in Asia, Australia is expected to
slow in  relative to , forecasts from IHS Global Insight
indicate that the growth of GDP in this region will be .% in
, with an expected rise to .% in .
As far as the trend in gross fixed investment is concerned, IHS
Global Insight anticipates that in  this key indicator will be
up by .% in real terms year-over-year. This means that capital
investment is expected to exceed the level it reached before
the recession. IHS Global Insight is forecasting a further in-
crease of .% in gross fixed investment in . This growth
is expected to be concentrated in Asia, Australia and the
Americas. IHS Global Insight is forecasting increases in gross
fixed investment in Asia, Australia of .% in  and .% in
. For the Americas, the forecast is for growth of .% in
 and .% in . Growth in gross fixed investment is
expected to be considerably slower in the Europe, C.I.S., Africa,
Middle East region, at .% in each of the two following years.
With an increase of .% in , manufacturing value added
is recovering rapidly from a sharp downturn during the reces-
sion. IHS Global Insight forecasts that growth rates for this key
indicator will return to more normal levels in  and ,
with figures of .% and .%, respectively. In particular, IHS
Global Insight estimates that growth in manufacturing value
added in the Asia, Australia region will drop down from the
historically high level of .% in  to .% in  and .%
in , thus returning to the growth pattern seen prior to the
recession.
The forecasts presented here for gross domestic product and
gross fixed investment are based on a report from IHS Global
Insight dated October , . The figures for manufacturing
value added are based on data from IHS Global Insight taken
from a report as of October , . Siemens has not indepen-
dently verified this data.
Market development
While demand in shorter-cycle markets served by the Industry
Sector already showed strong signs of recovery early in the
just-completed fiscal year, longer-cycle markets started to re-
cover only in part in fiscal . We expect the markets for our
shorter-cycle businesses to show an average of high single-
digit annual growth in the next two years. Our expectation for
the next two fiscal years also includes market growth for our
longer-cycle businesses. Here we expect slower growth than in
the markets for our shorter-cycle businesses.
The markets served by the Energy Sector hit bottom in the
second half of fiscal . For the next two fiscal years we ex-
pect the broad energy markets to show clear recovery driven
by increased electricity demand related to economic growth
and implementation of environment-friendly policies. Further-
more, emerging markets are expanding their power infrastruc-
tures while developed countries are modernizing their aging
infrastructure.
For the healthcare industry, in which our Healthcare Sector
participates, we see an improvement in the outlook over the
next two fiscal years due to growth in emerging markets com-
bined with a moderate recovery in the U.S. We anticipate that
these factors will offset potential impacts from cuts in public
spending for healthcare, particularly in Europe. Therefore we
expect mid-single-digit growth in the overall healthcare mar-
ket in the next two fiscal years.