BASF Report 2021 Management’s Report – Economic Environment 52 The BASF Group’s Business Year In this section: Economic Environment Results of Operations Net Assets Economic Environment1 Financial Position Actual Development Compared With Outlook for 2021 The global economy recovered more quickly in 2021 from the previous year’s severe slump in economic Business Review by Segment activity than had been expected at the beginning of the year. Many governments’ aid programs and rising Other vaccination rates were key contributing factors to the recovery. Nevertheless, the economic upturn was Non-Integral Oil and Gas Business repeatedly hampered by measures to contain the pandemic and supply chain disruptions. Regional Results For the outlook on the economic environment in 2022, see page 145 onward E.U. Taxonomy 2021 at a glance Trends in the global economy in 2021 GDP rates in 2021 were strongly influenced by base effects. China’s GDP grew at a double-digit rate in the first quarter year on year. In +5.8% >6% The recovery of the global economy varied from region to region in the second quarter, the United States and the European Union then 2021. There were severe restrictions on public life in the first half of recorded very high growth rates. Global growth slowed down, how- Global GDP growth Increase in global industrial the year, particularly in Europe. In the second and third quarters, ever, in the second half of the year. Bottlenecks in global supply and chemical production many Asian countries struggled with coronavirus outbreaks and chains increasingly limited industry growth. Added to this were the ▪ Economic recovery in Europe and the United States, slowing took corresponding countermeasures. China maintained its zero- dampening effects of very high energy prices and a further sharp momentum in Asia Covid strategy throughout the year and responded to the emer- rise in infection rates in individual countries. ▪ Dynamic growth in global industrial production despite fragile gence of any infections with strict containment measures. In the supply chains and stagnating automotive industry United States, most restrictions were eased after the first quarter ▪ Strong growth in the global chemical industry despite sharply rising infection numbers over the course of the year. The steady r eopening of economies was facilitated by increasing ▪ Sharp increase in prices for crude oil and naphtha, vaccination rates. Vaccination rates increased significantly during drastic rise in gas prices the year in Western Europe and the United States, followed by the advanced Asian countries and China with some delay. Other advanced emerging economies, for example in South America, now Global gross domestic product (GDP) grew by 5.8% year on year also have high vaccination rates. In contrast, vaccination rates are (2020: –3.4%). Industrial production expanded by 6.5% (2020: still low in large parts of the poorer countries of Africa and Asia, as –3.0%). Global chemical production grew by 6.1% (2020: –0.1%). well as in Russia. The average price for a barrel of Brent crude oil increased to $71 per barrel (2020: $42 per barrel). 1 All information relating to past years in this section can deviate from the previous year’s report due to statistical revisions. Where available, calendar-adjusted macroeconomic growth rates are reported. Figures for 2021 not yet available in full are estimated.