German firms struggle to keep up with EU and global rivals, according to Ifo data.
Based on findings from the Ifo Institute, German industries have been losing ground in the EU and international markets for the past two years. The Munich-based researchers shared these insights from their monthly evaluation. Within the EU, German companies started noticing a dip in their competitiveness starting from Q3 2022.
Similarly, the competitiveness issues began for global markets excluding the EU in Q1 2022. Klaus Wohlrabe, who leads the Ifo Surveys team, commented on this development, stating, "German industry is finding it tougher to keep up with the competition."
Almost every sector in the industry reported a drop in their competitive position during Q1 2024 compared to the end of 2023. The pharmaceutical and wood production (excluding furniture) industries are the lone exceptions.
More depressing news came for global markets not in the EU. With the exception of the beverage industry, all other sectors reported poorer competitive positions in Q4 2023 than in the previous quarter. The Ifo researchers pointed out a recent shift in the trend, with more German firms being squeezed on the home front. Previously, the majority of local firms were showing good performance, but that changed last year.
German business lobbies have recently been vocal about growing financial and regulatory challenges in the country. They're pushing for corporate tax reform, faster administrative processes and a decrease in bureaucracy.
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In the context of the EU market, German companies have continued to face challenges in maintaining competitiveness, as revealed in Ifo's Q3 2022 data. German firms also encountered similar struggles in global markets, starting from Q1 2022, according to the Ifo Institute's evaluations.
Source: www.ntv.de
