German companies are mostly optimistic about the coming year despite the Covid-19 pandemic and supply bottlenecks, the German Economic Institute (IW) said.
Most of the country’s trade associations reported an improved business situation compared to the end of 2020 and feel confident about the new year, Xinhua news agency quoted a survey conducted by the IW as saying.
None of the 48 associations surveyed expected a decline in production, and 39 of them even expected production to increase.
After a 4.6 per cent drop in gross domestic product (GDP) in 2020 and a projected 2.7 per cent growth in 2021, the German Council of Economic Experts (GCEE), an official advisory body to the government, said it expected GDP to grow by 4.6 per cent in 2022.
The IW survey found that the most of the “pessimists” are companies that have been “severely affected” by the Covid-19 pandemic.
Rubber and paper companies, as well as glass and leather industries, have been heavily affected by a shortage of raw materials.
The country’s trade show industry is even worse off than in 2020 and it is “still not foreseeable when the situation will normalize again”, the IW noted.
Many other sectors and industries, such as the services sector and the steel, chemical, metal, mechanical and construction industries, reported an improvement compared to 2020, according to the survey.
Germany’s construction industry in particular has “very good business prospects” as the country’s new government aims to build 400,000 new homes per year, the IW noted.