A Dimming Outlook for German Companies Overseas: Troubled Times Lie Ahead
Global businesses perceive worsening circumstances globally according to a survey of German enterprises
Facebook Twitter Whatsapp E-Mail Print Copy Link A Cloudy Horizon: German Companies Navigate a Sea of Uncertainty and Worsening Conditions Across Most Global Regions. The Economic Prospects of German Companies Abroad, as depicted in the Spring 2025 World Business Outlook (WBO) of the Chambers of Foreign Commerce (AHK), Paint a Grim Picture.
In the words of Volker Treier, head of foreign trade at the German Chamber of Industry and Commerce (DIHK), "The new U.S. trade policy is stampeding through the global economy like a freight train, knocking down German companies at their overseas locations without mercy." This harsh new U.S. trade policy, combined with international responses and geopolitical instabilities, are sending ripples of mistrust throughout the global economy, Treier explained. The consequences are severe: "Investments are on hold or canceled, and long-standing commercial relationships are being reconsidered," Treier warned.
The survey, which gathered responses from approximately 4,600 German companies in over 90 countries, was conducted between March 17 and April 14 – a period marked by significant global upheaval. Events such as the so-called "Liberation Day," when U.S. President Donald Trump announced tariffs against nearly every U.S. trading partner, weighed heavily on the global mood. According to the survey, the outlook worldwide is gloomy. Only 19 percent of companies anticipate an improvement in their local economic conditions, down from 27 percent in the fall. Conversely, 33 percent of companies expect a deterioration.
Beyond the Headlines
The current global economic conditions, as outlined by various forecasts for Spring 2025, present a complex picture for German companies:
- Sluggish Growth: The German economy is expected to show signs of growth, with a GDP increase of just 0.1% in 2025, according to some estimates[1][2]. However, other forecasts predict zero growth due to geopolitical conflicts and protectionist trade policies[5].
- Geopolitical Tensions: The escalating geopolitical tensions, fueled by protectionist trade policies in the U.S., are exacerbating the economic situation for German companies, increasing uncertainty and posing substantial hurdles for export-dependent industries[2][4].
- Intense International Competition: German companies face fierce competition from other nations, notably China, adding to their difficulties in the global market[1][2].
- Local Challenges: Structural issues like a shortage of skilled labor and bureaucratic hurdles further hinder growth for German companies[4].
- Monetary Policy: The German government's introduction of expansionary fiscal policies, including increased public spending, is anticipated to stimulate economic growth by around 0.5 percentage points[3][4]. However, the impact of these policies on private consumption and investment remains uncertain[2].
- The new U.S. trade policy, as warned by Volker Treier, head of foreign trade at the German Chamber of Industry and Commerce (DIHK), is causing a deterioration in the outlook for German companies abroad, particularly in their overseas locations.
- The Spring 2025 World Business Outlook (WBO) of the Chambers of Foreign Commerce (AHK) paints a grim picture of the economic prospects for German companies overseas, with only 19% anticipating an improvement in their local economic conditions.
- The general-news of significant global upheaval, including tariffs and geopolitical instabilities, has resulted in investments being on hold or canceled, and long-standing commercial relationships being reconsidered.
- Vocational training programs could be crucial for German companies navigating a sea of uncertainty, as the grim picture portrayed by the WBO highlights the need to adapt and innovate in the face of sluggish growth, fierce international competition, and local challenges like a shortage of skilled labor.
- Politicians need to look beyond headlines and focus on implementing community policy changes that address the financial concerns of German businesses, as the current global economic conditions have posed substantial hurdles for export-dependent industries.
