With production of USD2.3 trillion in 2016, Western Europe is the world’s second largest intermediate goods producer, following Asia Pacific. Western Europe is the largest intermediate goods exporter and importer. Future output growth is subdued due to decreased production of textile and due to overcapacity of steel over the world. However, Turkey is expected to result in positive intermediate goods output growth for the region over 2016-2025.
Intermediate goods production in Western Europe takes a significant role in terms of overall global production. Output value is expected to reach USD2.3trillionin 2016 and will post a CAGR of 0.4% over the period 2016-2025.
Recovering commodity prices and the growth of steel demand will boost intermediate goods production in Western Europe by 0.5% in 2018.
Germany will keep its leading position in the region and will be the main producer of intermediate goods. Furthermore, Germany will be the main importer with USD287,592 million and exporter with USD348,087 million in the region.
Turkey and Italy will benefit from the metal industry the most. Demand will increase in the home economy for Italy where production of vehicles increased and subsequently lifted demand for steel production. Turkey started exporting in new markets and this increased demand for steel.
Western Europe’s textile manufacturing outlook looks less promising than metal and chemical products.The industry is expected to post a negative CAGR of 0.3% over the period 2016-2025.
Western Europe takes first place in terms of both export and import volumes in the world. However, Asia Pacific is rapidly closing on Western Europe due to cheaper prices, with exports of USD1.2 trillion against Western Europe’s USD2.1 trillion.
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