AHK World Business Outlook Spring 2020 Results of the Survey by the Network of German Chambers of Commerce Abroad (AHKs)
GemeinsamWeltweit
2 | AHK World Business Outlook – Spring 2020
Summary The global economy and thus the business of German companies abroad are in a substantial crisis. Two thirds of the more than 4,000 companies surveyed by the AHKs worldwide expect the economy to deteriorate in the respective countries. Especially in Europe and North America, German companies are assuming a dramatically worsened economic development. Half expect their businesses to decline in the next twelve months. Many want to reduce their investments and cut personnel.
Economic expectations of the Companies worldwide Balance in points 40 20 0 -20 -40
As a direct consequence of the spread of the corona virus, 80 percent of German companies abroad ex-60 pect their sales to decline. 15 percent of the compa2015 2016 2017 2018 2019 2020 nies even assume that their annual sales will more than halve. The lower demand for the products and services, but also travel restrictions, the cancellation of trade fairs or the cancellation of orders are a problem for the companies. The greatest risk for companies in the next twelve months is the demand for goods and services. After around half of the companies in the preliminary survey in autumn 2019, there are now more than two thirds who see this as a major challenge for the further development of the business. However, the economic policy framework and the topic of financing - due to many business closings and the currently high and growing need for liquidity - are high business risks for German companies abroad.
The AHK World Business Outlook is based on a regular DIHK survey of the member companies of the German Chambers of Commerce Abroad, delegations and representative offices (AHKs). In spring 2020, it collected feedback from more than 4,000 German companies, branches and subsidiaries, as well as companies closely related to Germany. 38 percent of the responding companies come from the industrial and construction sector, 41 percent from the service sector and a further 21 percent are trading companies. Smaller companies with fewer than 100 employees account for 52 percent of the answers. 24 percent of the companies employ 100 to 1,000 people. Large companies with more than 1,000 employees also account for 24 percent of the respondents.
3 | AHK World Business Outlook – Spring 2020
German companies abroad Balance in points 60 40 20 0
business situation employment expectations
-20 -40
investments
-60 Spring 2015
Spring 2016
Spring 2017
Spring 2018
Spring 2019
Spring 2020
Economic expectations of companies worldwide In percent
Other EU, NO, CH, UK 67
North America 81 16
29 Euro Area
3
South America
China
8
15
7 Asia/Pacific 68
54 18
9 35
Better
20
30
78
Africa / MENA
73
49
South-/East Europe
72 20
3
Unchanged
26
11
Worse
6
4 | AHK World Business Outlook – Spring 2020
Sales changes as a result of the coronavirus pandemic in percent
No assessment possible Increased sales No changes
Decline of more than 50%
3
Decline of up to 10%
12
9
6 Decline between 10% and 25%
31
14
25 Decline between 25% and 50%
Impact of the coronavirus pandemic on businesses Travel restrictions
69%
Less demand
58%
Cancellation of orders
48%
Investments are postponed or cancelled
47%
Cancellation of trade fairs or events
47%
Problems in the supply chain or logistics
45%
Liquidity bottlenecks
33%
Missing goods or services
29%
Own production losses or sickness absence Miscellaneous
22% 3%
5 | AHK World Business Outlook – Spring 2020
Risks for the global economy in the coming twelve months in percent
demand
54 45
economic policy financing
22 23
trade barriers / preference of domestic companies labour costs
20
exchange rate
19
legal certainty
14
lack of skilled workers
14 12
energy and commodity prices infrastructure
9
17
11
Imprint Deutscher Industrie- und Handelskammertag e. V. Association of German Chambers of Commerce and Industry (DIHK) Department for International Economic Policy Publisher and Copyright © Deutscher Industrie- und Handelskammertag | Berlin | Brussels DIHK Berlin Mailing Address: 11052 Berlin | Street Address: Breite Straße 29 | Berlin-Mitte Phone: (030) 20 308-0 | Fax: (030) 20 308 1000 DIHK Brüssel Street address: 19 A-D, Avenue des Arts | B-1000 Brussels Phone: ++32-2-286 1611 | Fax: ++32-2-286 1605 Internet www.dihk.de www.facebook.com/DIHKBerlin http://twitter.com/DIHK_News Editor Ilja Nothnagel, Melanie Vogelbach, Kevin Heidenreich Graphics Lola Machleid Pictures https://www.gettyimages.de/
69
49
37 28
26 29
22 33
Spring 2020 Fall 2019