Low water levels are worrying the economy

It has hardly been raining for weeks, the water level is dropping, the coastal areas are drying up and new islands are appearing.  Low water is increasingly affecting inland navigation across the country.

It has hardly been raining for weeks, the water level is dropping, the coastal areas are drying up and new islands are appearing. Low water is increasingly affecting inland navigation across the country.

Source: Thomas Frey / dpa

The low water on the Rhine does not only have a direct impact on inland navigation. Industrial production may also suffer, experts warn economists – especially against the background of the existing problems.

DAccording to the economist, prof. Stefan Kooths of the Kiel Institute for World Economy, the economic consequences of the low Rhine water level are severe. “Calculations of the consequences of the low Rhine water level in 2018 show that industrial production drops by about 1 percent if the water level at the Kaub measurement point has dropped below the critical level of 78 centimeters over a period of 30 days,” he explained. Kooty.

At its peak, industrial production fell by about 1.5 percent in 2018, Kooths continued. Over the course of a year, low water levels are likely to cost about 0.4 percent of economic efficiency. “However, the situation at that time cannot be transferred from one to one to the present day” – explained the scientist. The “fall increase” for German industrial production was then much greater.

However, the negative effects of supply bottlenecks are much worse for the industry: “Until recently, due to supply bottlenecks, industrial production was down 7%. below the level that would be expected considering incoming orders, ”said the vice president and economic director of the Kiel Institute.

“Right now, however, is the fact that low-water obstacles are affecting already very tight supply chains,” he said. Inland navigation is also an important means of transporting energy resources. However, based on the experience of 2018, companies should be better prepared for emergencies in inland navigation, e.g. by using other types of ships.

However, any additional stress factor weakens economic dynamics. And each additional hurdle to production raises prices as the mismatch between supply and demand widens. “From an inflation standpoint, it’s not just about the consequences of rising transportation costs,” explained Kooths.

According to the information, only a small part of goods transported in Germany is transported by inland waterway: in 2017 it was 6%. On the other hand, in the case of individual groups of goods, such as coal, crude oil and natural gas, coking plants and petroleum products, and chemical products, inland shipping accounted for 10 to 30 percent. transport volume. “These goods are at the beginning of many production chains, so failure to transport them can lead to production bottlenecks downstream.”

A shock to the small sector – inland shipping’s share of gross value added in Germany is below 0.2%. – could have a significant impact on other sectors.

The level at Kaub in Rhineland-Palatinate, which is important for navigation on the Rhine, dropped further Friday. According to the administration of shipping and shipping, in the morning it was 42 centimeters, which is about 5 centimeters lower than at the same time of the previous day. According to the office’s forecasts, the 40-cm mark may drop on Friday.

Crucial to navigation on Thursday was just 1.59 meters – less than on any other stretch of the middle and lower Rhine. Therefore, Kaub in the district of Rhein-Lahn is considered an important inland navigation point on the Rhine.

The Federal Institute of Hydrology (BfG) recently announced that shallow inland waterway vessels can still sail across the middle Rhine to a water level of approximately 30 to 35 centimeters at Kaub gauge. However, forecasts assume water levels towards 30 centimeters by the beginning of next week at the Kaub level. Thereafter, Rhine navigation in this area “tends to stop”.

Leave a Comment