Our guest in the studio: Thomas Straubhaar, Hamburg Institute of International Economics
DW-TV: Well, it doesn't sound like things are going to change any time soon. Let's see if our guest can give us reason for hope. Thomas Straubhaar, director of the Hamburg Institute of International Economics.
How big a role do speculators actually play?
Thomas Straubhaar: Actually they play a very important role because of course their demand or their behaviour on the stock markets and the raw material markets will have influence on the price development, but on the other hand their role is also positive because they give signals to everybody playing on the market, meaning that they also await waste or they give a signal to increase the production, so they have two roles to play.
DW-TV: What can producers do?
Thomas Straubhaar: It's difficult to do something in the short-run because it is an agricultural product and it takes time to produce it so for the short-term there is not much to do. In the long-run they could probably increase efficiency, they could take other seeds or they could increase artifical behaviour to help plants of seeds to grow, so in the long-run there is something to do, in the short-run we have to live with these price variations.
DW-TV: Is it fair though to hedge bets on life's neccesities?
Thomas Straubhaar: I wouldn't say so, I would say that it's the economy basically that should determine the price, and you could not influence too much with political regulations or with other law regulations the influence on prices.
DW-TV: Some experts have called for greater investment in agriculture from the public and private sectors. Could that help?
Thomas Straubhaar: Absolutely, in the long-run I think we have a growing population, we have more needs for food worldwide in the next decades, so I think there is no way to avoid or to go against higher production so all investments in agricultural business is a good investment to reduce this price volatility.
DW-TV: Regarding our report on Germany as Europe's Economic Engine. Do you think other European countries can use this recipe for their own success?
Thomas Straubhaar: Not in the short term, because I think most of these ingredients have a past dependency. They have been developed over years, over decades, over generations -- like the economic structure of Germany -- meaning that there are a lot of small and medium-sized enterprises. There are a lot of family-owned businesses. There is this technology-driven mentality in the German behaviour. So I think all these ingredients are not transferrable in an easy and short-term way.
DW-TV: Okay, well let's have at some of the figures, the German growth figures in comparison to France and the eurozone as a whole.
You can see that there was a peak in 2008, first of all, and then the effects of the financial crisis, of course. Germany's economy was actually hit harder than France's and others in the eurozone. But strict austerity measures have certainly got things back on track for Germany.
Now are the big gains we're seeing now simply a result of that big fall we saw in the graph?
Thomas Straubhaar: Yes, of course. The decline and the recession in Germany were so fast and so deep that now the catch-up and the recovery are also fast and, of course, stronger than in France or in other European countries.
DW-TV: So how long can the economy continue to motor along?
Thomas Straubhaar: I think this growth path will be sustainable for quite a while -- for another decade or so-- because the long-term trends behind this growth are still going on. Meaning that we are still living for a decade or more in a growing population worldwide, with people who have more need for basic goods, for infrastructure, goods for investments of all kinds....So these factors will have a positive impact for quite a long time on the German economy.
DW-TV: So not just another climax, or another peak, that we're seeing?
Thomas Straubhaar: Definitely not. I'm very optimistic that all these factors will last for quite a while. The German economy has done a good job in the last decade and it will do a good job in the next decade.
Interview: Ben Fajzullin