German companies warn of the economic deterioration of Spain and stop their investments
Juan Carlos Valero
Updated: 05/12/2022 1:59 p.m.
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51.4% of the German multinationals present in Spain see a worsening of the expectations of the Spanish economy in the next twelve months, according to the spring barometer carried out by the German Chamber of Commerce for Spain between March 28 and 22. of April. As a consequence of this deterioration, motivated mainly by the crisis in Ukraine, German businessmen are slowing down the expansion of their investment in our country, to the point that a quarter (24.3%) will reduce or not carry out any investment in the next twelve months, although a third (31.1%) do foresee an increase in their local investments and 44.6% will not change what they had planned.
In Spain there are 1,386 German companies, the largest group of foreign companies in our country, with a turnover of 81,821 million euros per year and 209,000 direct jobs.
In 2020, direct German investments in Spain accumulated a "stock" value of 41,678 million euros, according to data from the Bundesbank. In 2021 direct investments amounted to 4,010 million euros. 40% of the companies are industrial and a similar percentage is dedicated to commerce, while 20% to services. 45% have their headquarters in Catalonia and 30% in Madrid.
In the current barometer of the German Chamber of Commerce for Spain, 87% of companies see their situation as "good" or "satisfactory", but the number of companies whose expectations worsen compared to autumn doubles to 13.5%. 2021, which represents the maximum percentage of the last three surveys. In terms of employment, despite the deterioration of the economy and the outlook, 39.2% expect a growth in their workforce in the next twelve months, while companies that do not plan to change their workforce grow to 50% and there is no alarm of employment reduction in the rest of the cases, slightly decreasing the percentage of companies with the intention of reducing the number of employees.
The lack of raw materials and supplies, their price and that of energy are at the top of the main concerns of companies (81%), while the interruption in the supply chain and logistics worries 70%; 47% perceive or anticipate a lack of raw materials and 34% see the risk of reduced orders. The economic and political framework gains importance with respect to the autumn barometer and labor costs and the shortage of qualified labor are concerns for a quarter of the companies, while the risk of legal certainty is reduced, which is only considered by 10, 8%.
The German Chamber of Commerce for Spain brings together 1,100 member companies and will hold the sixth Spanish-German business meeting in Barcelona in October. It was created in 1917 and is the first point of contact for economic and commercial relations between Germany and Spain. It is part of a worldwide network with 140 offices in 92 countries and in Spain it has offices in Madrid and Barcelona, although it also has delegates in Zaragoza, Bilbao and Valencia.
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