Responding to a request from the country’s major construction industry trade associations, German ministries on March 25 announced that building, transportation, water supply and other infrastructure construction could continue in order to limit economic consequence from business lockdowns linked to the COVID-19 pandemic.
The directive follows an appeal earlier in the week from the main German construction trade associations—Central Association for Construction Industry (ZDB), German Construction Industry Federation (HDB) and Federal Association for Small- and Mid-Size Construction Businesses (BVMB).
All had asked that public construction and planning continue to protect the industry as the economic consequences from the pandemic lockdown grew potentially dire.
“The continuation and new tendering for construction and infrastructure projects is an essential pillar for the domestic economy and needs to be upheld,” says Reinhard Quast, ZDB president.
HDB President Peter Hübner pointed to construction as part of the everyday fabric. “This is the only way to ensure in these difficult times that system-critical areas such as telecommunications, mobility and energy production can continue to function.”
Last weekend the federal German states agreed to strict measures to curb public activity, which include banning public meetings of more than two people and mandating 1.5-meter distances between them, closing restaurants to sit-down dining and shuttering most retail and other service businesses.
Germany’s Ifo think tank on March 23 released a report estimating the shutdown could cost the country between 7.25% and 20.6% of GDP, assuming shutdowns of just one to three months. The German government in Berlin is considering coronavirus backstop earmarks of up to $810 billion to shore up its economy.
National carrier Lufthansa has grounded 95% of its regular flights until at least mid-April.
While there are stoppages, especially on smaller jobs, by and large German construction sites remain open, with leading building firm Hochtief telling the German financial publication WirtschaftWoche that it is important for operations to continue—while taking precautionary measures and restrictions into account.
In normal times, the German building industry generates nearly $11 billion per month and employs 4 million people.
Coronavirus-related border closings and restrictions, however, have hampered operations, firms say.
Zeppelin Rental reports that demand for rental equipment has grown for certain types of products as customers push to finish projects more quickly before some sites are potentially closed, while German equipment manufacturer Wacker Neuson announced it will cut production, with some plants instituting short-time work models, said KHL, an international digital industry publication, on March 25.
The country has reported more than 9,000 positive virus cases, although its death toll is only 0.4%, less than the 4% average of most other countries.