Siemens 2012 Annual Report Download - page 149

135 D. Consolidated Financial Statements
239 E. Additional Information
130 C. Siemens AG (Discussion on basis of
German Commercial Code)
134 C. Notes and forward-looking statements
129 C. Compensation Report, Corporate Governance
statement pursuant to Section a of the
German Commercial Code, Takeover-relevant
information and explanatory report

From a regional perspective, the slowdown is sharpest in
Europe, with economic growth coming to a standstill in .
Restrictive fiscal policies, rising unemployment, large capital
outflows to northern countries and the sovereign debt crisis
have all deepened the contraction in the southern periphery
economies. This in turn increasingly hampers growth in the
core northern countries such as Germany. On top of that, the
uncertain economic situation in Europe keeps consumer
spending and private-sector investments on a low level. Gross
fixed investment, one way in which gross domestic product is
used, is expected to decline by .% in  compared to .
To foster the stability of the Eurozone, European governments
have taken important measures. The establishment of the per-
manent European Stability Mechanism (ESM) as a substitute
for the temporary European Financial Stability Facility is aimed
at ensuring the financial solvency of the Eurozone countries.
Moreover, in order to bring down government bond yields and
to ensure the functioning of monetary operations in every
country of the monetary union, the European Central Bank
(ECB) has declared its willingness to buy sovereign bonds on
the secondary market without limit if a country meets the cri-
teria of the ESM. This announcement calmed financial markets
and reduced yields of Italian and Spanish bonds, making refi-
nancing cheaper for these countries. Economic development
in the Middle East is still affected by severe geopolitical ten-
sions involving Iran and ongoing violence and unrest in Yemen
and Syria, where the economy is contracting rapidly. In con-
trast, growth in other oil-exporting countries remains robust,
due to high oil prices. Growth in Africa is surprisingly strong
in . But the continent still suffers from an unstable politi-
cal environment, and economic growth in many countries is
highly dependent on raw material prices. The C.I.S. countries
have to deal with relatively low growth of .% in . The
whole region is negatively affected by the European sovereign
debt crisis due to financial and trade linkages.
In the Americas, GDP growth is expected to slow slightly in
, to .%. On one hand, the growth rate in Latin America is
expected to decrease to .%, due in part to lower export de-
mand from a weak global economy. Furthermore, the global
slowdown also causes some commodity prices to fall, which
strongly affects Latin America as a major seller of commodi-
ties. Hence, investment spending has slowed down consider-
ably. Representative for the economic development in Latin
America is Brazil, which is expected to grow by only .% in
. On the other hand, the U.S. is expected to grow slightly
faster year-over-year, with .% growth compared to .% in
. U.S. investment growth is expected to be particularly
strong: .% in  compared to .% in . Additionally,
the American housing market seems to be stabilizing towards
the end of the year. Nevertheless, the U.S. faces a high level of
debt and low employment growth. Moreover, the country ’s
political gridlock creates economic uncertainty particularly re-
garding tax increases and spending cuts that will take place
automatically at the beginning of  if no agreement can be
reached (the so-called fiscal cliff).
In Asia, Australia growth is accelerating slightly in , al-
though China’s and India’s extraordinarily high growth levels
are expected to cool down to .% and .%, respectively.
China, a leading exporter, is significantly affected by the
decrease in global demand, so gross fixed investments are
trending in line with slower GDP growth. The Chinese govern-
ment has implemented expansionary fiscal and monetary
measures in order to support the economy. The Indian econo-
my is negatively affected by strong credit linkages with a
struggling Europe and weaker capital inflows. Moreover, India
was also hit by a series of major electricity failures throughout
the whole country. Japan’s economy started to recover from
the consequences of the earthquake and tsunami in March
. Its expected growth rate of .% is caused mainly by in-
creased government spending, with a boost from stronger
    (     ) 
     
1 According to IHS Global Insight as of October , ;
growth rates provided by calendar year.
2 Estimate for calendar year .
1.6
(2.0)
3.0
4.2
2.5
    
(      ) 
World Europe, C.I.S.,
Africa,
Middle East
Americas Asia,
Australia






 
1 According to IHS Global Insight as of October , ;
growth rates provided by calendar year.
2 Estimate for calendar year .
3 Commonwealth of Independent States.
2.5
0.9
2.3
4.64.7
3.0 2.4 2.4