KfW Sustainability Indicator 2013: no more than limited progress

Frankfurt (ots) -

- Economy indicator continues to improve at a high level: labour
force participation rate records new all-time high
- Environment indicator has declined: weather causes increase in
energy consumption and greenhouse gas emissions
- Social cohesion indicator slightly improved: economic trend
supports integration via the labour market

The KfW Sustainability Indicator 2013 is weaker than in the
previous year and only just above the average value of the preceding
ten years. While the "economy" and "social cohesion" dimensions
continued to record positive figures, the environment dimension
worsened substantially.

"Germany continues to report a sustained performance. The economic
situation on the labour market, in particular, is leading to greater
social cohesion, which is very positively reflected in our indicator.
At the same time, however, higher energy consumption due to growth
and the weather weigh on the environmental balance and mar the
overall result. If growth in Germany continues to show increased
momentum in 2014, it will once again be a challenge to keep the
environment indicator above the 10-year average next year", said Dr
Jörg Zeuner, Chief Economist of the KfW Group.

Economy: situation on the labour market leads to substantial
increase

Germany was able in 2012 to keep private and state spending on
research and development high. The labour participation rate rose to
a fresh all-time high of 53.5%. This makes a key contribution to the
good result of the economy dimension of the KfW Sustainability
Indicator, which now exceeds the average for the preceding ten years
by 0.6 points. By contrast, the persistently low level of investment
activity by the state and by companies gives cause for concern.
"Despite good financing conditions, the net investment ratio stands
at only 2.6%. This is too low for a sustained performance in
Germany", said Dr Zeuner.

Environment: progress becoming more difficult

The environment dimension fell to an all-time low in 2012 (-0.5
points). The decline was due to the weather-related increase in
energy consumption and to the pro rata increase in the use of brown
coal and hard coal, which led to rising greenhouse gas emissions and
lower energy productivity. The trend of raw material productivity
recorded a deterioration for the first time in 2012. On a positive
note, noise pollution was improved while land consumption was
reduced. "As renewable energies continue to expand, the targeted
objectives of the energy turnaround require, in particular, a faster
pace in the improvement of energy efficiency", said Dr Zeuner.

Social cohesion: falling unemployment helping participation and
integration

The social cohesion dimension continued the positive performance
seen in previous years and at 0.4 remained only 0.1 points below the
previous year's figure. Boosted by the good performance on the labour
market the social participation of all population groups improved.
The percentage of the long-term unemployed was encouragingly low, and
in 2012 people of foreign origin were better integrated into the
labour market than in the previous years. Although the percentage of
people with low qualifications (25 to 30 year olds without an
educational qualification) has fallen further, it remains too high at
just under one quarter. The ageing society is likely to have made a
major contribution to the increase in the incidences of illness
requiring hospital treatment.

The KfW Sustainability Indicator

The KfW Sustainability Indicator provides quantitative information
on the progress made in the sustainable development in Germany.
Appropriate key topics were identified for the areas of the economy,
the environment and social cohesion and backed by the appropriate
basic indicators. In total, three key topics with 24 basic indicators
were selected.

The progress in the sustainability situation was measured using
changes in these basic indicators over time. The common benchmark for
all basic indicators is to be at least as good as or better than the
average score of the more recent past, which is defined as a sliding
ten-year period prior to the relevant reference year. The individual
information is consolidated into an overall value of the KfW
Sustainability Indicator by applying a scoring method.

The full results and information on the make-up of the KfW
Sustainability Indicator 2013 are available for download at
www.kfw.de/nachhaltigkeitsindikator.

Contact:
KfW, Palmengartenstr. 5 - 9, 60325 Frankfurt
Kommunikation (KOM) Dr Charis Pöthig
Tel. +49 (0)69 7431 4400, Fax: +49 (0)69 7431 3266,
E-Mail: presse@kfw.de, Internet: www.kfw.de