Despite the challenges posed by the Ukraine war, Germany’s companies have so far proven to be robust. The number of company bankruptcies also declined in the first half of the year. But now experts fear a trend reversal.
The Ukraine war and its economic consequences pose major challenges for companies in Germany. Nevertheless, a wave of bankruptcies failed to materialize. The number of corporate insolvencies even declined in the first half of the year, as the credit agency Creditreform reported on Tuesday.
However, the experts fear a trend reversal in view of the difficult economic conditions in the second half.
Fewer bankruptcy filings
According to Creditreform, a total of 7,300 companies filed for bankruptcy between January and June, 2.8 percent fewer than in the same period last year. “Despite more than two years of Corona and the recent massive cost explosion, there has been no increase in insolvencies,” reported the head of Creditreform economic research, Patrik-Ludwig Hantzsch. However, the burdens of the Ukraine war and the rising energy prices would probably not have hit the insolvency events in Germany with full force. However, a dramatic wave of bankruptcies is not to be expected in the second half of the year either.
The credit agency emphasized that the first effects of the upheavals can already be seen in parts of the corporate landscape. For large companies with sales of more than 50 million euros, the number of insolvencies has doubled compared to the previous year. Prominent examples are the MV shipyards and the Orsay fashion chain.
In addition, there are many insolvencies of the self-employed, who mostly went through a simplified insolvency procedure and are therefore not counted as corporate insolvencies. “For many micro-entrepreneurs and freelancers, the general conditions in the Corona period were extremely bad,” said Hantzsch.
Young companies particularly affected
It is also striking that the insolvent companies were significantly younger in the first half of the year than in previous years. Almost a quarter had been on the market for no more than four years. “This development is new,” said Hantzsch. In recent years, the bankruptcy candidates have become older and older. Apparently, corona lockdowns and the repeatedly disrupted supply chains had particularly affected the young companies.
According to Creditreform, around 68,000 employees were affected by the insolvency of their employer in the first half of the year, 8,000 fewer than in the same period last year. The damage for the creditors added up to around 19 billion euros.
Creditreform is not alone in its concerns about future insolvency developments. A few weeks ago, the credit insurer Allianz Trade forecast that the number of corporate insolvencies in Germany could increase by 4 percent this year. For the coming year, the experts expect an increase of 10 percent.
fear of major bankruptcies
Above all, the credit insurer fears more major bankruptcies. This is a consequence of a whole bundle of problems such as the war, the lockdowns in China, interrupted supply chains and increased costs for labour, energy and raw materials. «Companies should not be fooled into thinking they are safe. If it crashes, then really, »said the Germany boss of Allianz Trade, Milo Bogaerts.
At 32,800, the number of consumer bankruptcies in the first half of the year was 23 percent below the previous year’s level. A year ago, a change in consumer bankruptcy law brought relief for over-indebted private individuals. As a result, the number of consumer bankruptcies had temporarily skyrocketed.
Source: Stern
Jane Stock is a technology author, who has written for 24 Hours World. She writes about the latest in technology news and trends, and is always on the lookout for new and innovative ways to improve his audience’s experience.
