Group Management Report

Economic developments
The world economy continued to grow in the year 2006 at an overall rate of 5.1 %. Economic developments compared with the prior year were mainly positive in Bilfinger Berger’s key markets.

In the euro zone, gross domestic product increased by 2.7%, not quite equaling the growth rate for the global economy. In Germany, the economic upswing accelerated considerably last year, aided by ongoing rises in exports but increasingly also by improved domestic demand. Real gross domestic product increased by 2.7%, which led to increasing tax revenue for the federal government, the federal states and the municipalities, as well as higher levels of employment. The French economy expanded at rate of 2.2 %, primarily driven by private consumption. The United Kingdom recorded solid growth of 2.8 % in 2006; companies continued their high investment rates against a backdrop of healthy profits and high utilization of capacity. Economic growth was particularly strong in Sweden at 4.0 %, with strong support from an expansionary monetary policy. In Norway, GDP increased by 3.0 %. Growth in Poland reached 5.2 % – due not least to the country’s entry into the European Union.

Economic expansion in the United States slowed down somewhat during 2006. Higher interest rates increasingly placed a burden on investment and consumption. Nonetheless, over the year as a whole, GDP still grew by 3.4 %.

The Australian economy is enjoying a long growth phase, with a GDP increase of 3.1 % last year. This stable development is due in particular to the ongoing strong global demand for raw materials. Investment sentiment is very confident, inflation remained moderate, and the unemployment rate is still low.