FRANKFURT (dpa-AFX) - The crisis-ridden German chemical and pharmaceutical industry is becoming more confident for the current year. There are the first rays of hope for the chemical and pharmaceutical industry, the German Chemical Industry Association (VCI) announced in Frankfurt on Wednesday. After a disappointing final quarter, production and turnover increased in the first quarter.

Thanks to the better start to the year, production is now expected to increase by 3.5 percent. Despite falling prices, industry turnover is expected to increase by 1.5% this year. In March, the association was still forecasting a 3.5% drop in turnover and stagnating production.

"We are now somewhat more confident about the future, as growth prospects are slowly brightening," said VCI President Markus Steilemann. However, this is a positive snapshot. One good quarter does not make up for the slumps of the crisis years. The situation is fragile overall. Even if demand picks up, the order situation remains weak overall, especially in Germany.

In the first quarter, total turnover increased by 1.8% to 56.5 billion euros compared to the previous quarter. Production rose by 6.5 percent overall and by 6.3 percent in the chemical industry alone. The association justified this with increased demand from outside Europe and empty warehouses in the industries. However, the industrial economy in Germany and Europe as a whole remained weak. Meanwhile, employment remained stable at around 479,500 people in Germany.

The chemical and pharmaceutical industry experienced difficult times due to the rise in energy prices in the wake of the war in Ukraine and the weak economy. While gas prices have fallen significantly again, the energy-intensive chemical industry in particular is suffering from electricity prices that are high by global standards.

"Germany is and remains too expensive as a business location and only politicians can change this," emphasized Steilemann. The federal government must not sit back and finally tackle the structural problems at the location. After all, whether there will be a strong recovery in industry in the long term depends above all on political will and action./mne/jha/