Spring 2025
Results of a survey of German chambers of commerce abroad, delegations and representative offices
Methodology
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 2025, it collects feedback from 4 600 German companies, branches and subsidiaries worldwide as well as companies with close ties to Germany. The survey was conducted from 17 March to 14 April 2025. 40 per cent of the responding companies come from the industry and construction sector, 41 per cent from the service sector and a further 19 per cent are trading companies. Smaller companies with fewer than 100 employees accounted for 48 per cent of the responses. 25 per cent of the companies employ 100 to 1,000 employees. Large companies with more than 1,000 employees account for 27 per cent of respondents worldwide. 47 per cent are subsidiaries/branches of German companies, 40 per cent are local or (non-German) international companies without a branch in Germany and a further 13 per cent are local or (non-German) international companies with a branch in Germany. The results for the continental regions and the global value are weighted. The basis for the weighting of an individual country is the average gross domestic product (GDP) for the years 2017-2021 in US dollars. The questions on the business situation, expectations, economic activity, investments and employment are weighted accordingly.
Imprint
German Chamber of Commerce and Industry International economic policy, foreign trade law
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Editor: Lola Machleid
Graphic: Sebastian Titze
Cover picture: https://www.gettyimages.de/
Status: May 2025
Development of the global economy
Economic expectations of German companies abroad
In spring 2025, the approximately 4,600 companies surveyed by the AHKs around the world are significantly more pessimistic about economic development in their international locations than they were in autumn 2024. Following the coronavirus pandemic and the energy price crisis, US trade policy is causing a deep cut in the global economy German companies are currently more pessimistic than average at their international locations: only 19 per cent expect economic development at their locations to improve over the next twelve months (autumn 2024: 27 per cent). In contrast, 33 per cent expect the local economy to slow down (autumn 2024: 22 per cent). Less than half of companies expect stable development based on the current economic situation (48 per cent). The resulting balance of better and worse assessments falls drastically compared to the autumn value of five points to currently minus 14 points This is well below the long-term average of two points (recorded since 2015). The negative assessment of the economic outlook for the coming year illustrates the great uncertainty among companies due to the erratic US trade policy, which is having a negative impact on many locations, and its effects worldwide The balance is currently at its lowest level since autumn 2022
Economic expectations of companies worldwide (balance of "better" minus "worse" - answers in points)
Expectations regarding the economic situation differ between the regions of the world, with an overall global deterioration compared to autumn 2024
Companies in North America are particularly negative: only 13 per cent expect a positive economic development, while almost half (47 per cent) expect a deterioration. The balance plummets from 26 points in autumn 2024 to currently minus 34 points The long-term average is twelve points. No lower value has been recorded since the outbreak of the coronavirus pandemic five years ago. Companies in Canada are particularly pessimistic: only seven per cent expect economic development to improve, while 76 per cent expect it to worsen. The resulting balance of minus 69 points is by far the lowest in the world However, companies in Mexico are also very pessimistic (balance of minus 52 points). Companies in the USA are also very uncertain. The tide has turned from confidence to pessimism: Only 14 per cent of companies still see the economy improving, while 44 per cent see it worsening (autumn 2024: 38 per cent better, seven percentage points worse). The balance plummets by 61 points, falling from 31 points to just minus 30 points This is well below the long-term average of 21 points. In the highly networked, globalised world economy in which companies in the USA, maintain close business relationships with trading partners all over the world, the US government's tariff increases will not go unnoticed German companies on the ground expect the same
Companies in the Asia/Pacific region and companies in Greater China (China, Hong Kong and Taiwan) are pessimistic about economic development in the coming year. A significant deterioration compared to autumn 2024 can be seen in mainland China as well as in Hong Kong and Taiwan. China in particular has been hit by massive new US tariffs of now 145 per cent on almost all imports. While a slight recovery in economic development was still expected in China in autumn 2024, the picture has now changed: Only eleven per cent still expect an improvement, while 27 per cent of companies expect the local economy to deteriorate. The balance of minus 16 points is in negative territory and well below the long-term average of plus two points.
In South and Central America, companies also expect the economy to slow down: although 24 per cent expect the economic situation to improve, 30 per cent expect it to deteriorate locally. The balance slips from positive to negative territory (minus six points after previously two points), but is still above the global average (minus 14 points)
In the eurozone, companies are once again more pessimistic than in the previous survey. 16 per cent expect the economy to improve, 37 per cent expect it to deteriorate. The balance fell from minus 13 points in autumn 2024 to minus 21 points, which is still well below the long-term average of minus two points. Economic expectations are also darkening again in Eastern and South-Eastern Europe and Turkey: only 11 per cent expect a positive economic development locally, while 45 per cent anticipate a deterioration. The balance falls significantly from minus 18 to just minus 34 points.
For the rest of the EU, Switzerland, Norway and the UK, there are signs of a slight improvement compared to autumn 2024, contrary to the global downward trend, although the outlook for local economic development remains pessimistic. 19 per cent of companies expect an improvement, while 34 per cent expect the local economy to deteriorate (balance: minus 15, compared to minus 21 points previously).
The only region in which companies predominantly expect the economy to perform well is Africa, Middle East and North Africa: 40 per cent of companies expect the economy to improve, while 14 per cent anticipate a deterioration in the coming twelve months (26 after previously 27 balance points). Companies in sub-Saharan Africa are also positive. Here, 32 per cent of companies expect an improvement and only 13 per cent a deterioration (13 after previously nine balance points).
expectations of companies worldwide (proportion of responses in per cent)
EU, Switzerland, Norway, UK
China Asia/Pacific (excl. China) Rest of Europe incl. Türkiye
North America (=USA, Canada, Mexico)
Business situation and business expectations
The USA's aggressive trade policy has put a real damper on global economic growth and global trade in particular The latest forecasts for global economic growth have been revised downwards Growth is now only expected to be below average. This not only has an impact on companies' assessment of economic development, but also on their own business situation and business expectations
German companies at their international locations rate the current business situation worse than in the previous survey in autumn 2024 Increasing trade restrictions and the upheaval in the international economic order are a major concern for companies. Nevertheless, they still rate their own situation better than the economy and their own business expectations for the next twelve months: 41 per cent of companies rate their business situation as good At least 44 per cent report a satisfactory business situation, while 15 per cent still rate their current business as poor The balance of "good" and "poor" assessments fell again compared to the previous survey - from 27 to 26 points. The assessment of current business thus remains more negative than the global average of recent years (34 points)
In a comparison of economic sectors, the business situation is still best among service companies: 45 per cent rate their situation as good and only ten per cent as poor (balance 35 points) Retail companies (42 per cent good, 12 per cent poor, balance 30 points) are somewhat more reserved in their assessment of their current business situation However, the assessment of industrial and construction companies is the most cautious compared to the other sectors (40 per cent good, 15 per cent bad, balance 25 points)
Business situation of companies worldwide (balance of "good" minus "bad" minus answers in points)
The assessment of the business situation shows considerable differences between the various global regions as well as significant differences before and after the US government's trade policy announcements on 2 April 2025
Companies in North America still rate their current business situation slightly positively, but worse than in autumn 2024 (before the US election): half of companies operating in North America report a good business situation (49 per cent), while 13 per cent rate it as poor. At 36 points, the balance is nevertheless significantly below the long-term average of 49 points. The situation has deteriorated in all three countries in the region (Canada, Mexico and the USA) In Canada, 45 per cent of companies still rate their situation as good (autumn 2024: 53 per
cent), while 10 per cent rate it as poor. The resulting balance has fallen from 40 to currently 34 points and is therefore below the long-term average of 50 points. In Mexico, only 36 per cent rate their situation as good (autumn 2024: 48 per cent) and eight per cent as poor The balance fell from 41 points to the current 28 points. In the USA, half of companies (51 per cent) still rate their business as good The proportion reporting a poor business situation has to 13 per cent compared to autumn (previously eight per cent). The balance deteriorated from 47 to 37 points and is well below the long-term average of 53 points.
Compared to the previous survey, the situation assessment of companies in South and Central America has improved: 46 per cent report a good business situation, while nine per cent report a poor one. This means that the balance has improved by ten points (37 after 27 points previously)
Business situation of companies worldwide (proportion of responses in per cent)
Other EU, Switzerland, Norway, UK
Rest of Europe incl. Türkiye
Asia/Pacific (excl. China)
Greater China
North America (=USA, Canada, Mexico)
South and Central America
Africa, Near and Middle East
While the current business situation of companies in Africa, the Middle East and the MENA region has deteriorated compared to the previous survey in autumn (balance 39 after previously 43 points and 44 after previously 57 points), the current situation in sub-Saharan Africa has improved (balance 26 after previously 14 points). Here, 41 per cent of companies rate their current business situation as good and 15 per cent as poor
In Greater China, the situation assessment of German companies is only slightly worse than in autumn: a quarter of companies rate their situation as "good", while 27 per cent rate it as " poor". The balance fell slightly from minus one to currently minus two points. A similar picture emerges for the People's Republic of China, where companies are more negative in their assessment of the situation than in autumn 2024. Just under a quarter of companies (24 per cent) rate the current business situation as good, while 29 per cent rate it as poor. The balance also fell slightly from minus three to minus five points. Only Hong Kong paints a more positive picture: 31 per cent rate their situation as good, 14 per cent as poor. The balance here has risen from seven points in autumn to the current 17 points.
Companies in the Asia/Pacific region (excluding Greater China) assess their current business situation as better than in autumn 2024: 38 per cent describe the situation as "good", 15 per cent as "poor"
In Eastern/South Eastern Europe (excluding the EU) and Turkey, the assessment of the current situation is worse than in the previous survey. 38 per cent of companies rate their current business situation as good, around half of companies rate it as unchanged and eleven per cent report a poor situation.
Companies in the eurozone report a better business situation than in autumn (balance 28 points compared to 25 points previously).
In contrast to the only slightly worse assessment of the current business situation, companies' business expectations are significantly more pessimistic compared to autumn. 41 per cent of companies expect business to improve over the next twelve months (autumn 2024: 48 per cent), while 43 per cent expect business to remain stable (autumn 2024: 42 per cent) 16 per cent expect their local business activities to deteriorate (autumn 2024: ten per cent). The balance of better and worse assessments has therefore fallen from 38 points to just 25 points - and is therefore once again below the long-term average of 34 points
There is uncertainty and concern around the world about how the global economic order will develop overall Companies are pessimistic about the outlook for their business activities and the local economy
Business expectations of companies worldwide (balance of "better" minus "worse" minus answers in points)
While economic development in the USA was still a source of hope for local companies last year, business expectations in North America have deteriorated significantly, particularly in light of the trade policy announcements made by the US administration: Only 31 per cent of companies now expect better business for the coming year, while 26 per cent of German companies expect their business in North America to deteriorate. The balance has plummeted from 50 points in autumn 2024 to just five points at present. German companies with locations in the USA are also significantly more pessimistic about their business development compared to the global sentiment. In the US, only a third of companies expect business to improve in the coming year, while a quarter of companies anticipate a deterioration for this period. The balance of business expectations plummeted from 52 to just nine points.
Business expectations of companies worldwide (proportion of mentions in per cent)
Other EU, Switzerland, Norway, UK
Rest of Europe incl. Türkiye
Asia/Pacific (excl. China)
Greater China
North America (=USA, Canada, Mexico)
South and Central America
Africa, Near and Middle East
Sub-Saharan Africa
In terms of business expectations, the mood among local companies in the Asia/Pacific region (excluding Greater China) has also deteriorated compared to autumn: 49 per cent, or just under half of companies, expect business to improve in the coming year, although 14 per cent of companies anticipate a deterioration. The balance falls from 43 points to currently 35 points
Companies in Greater China are more pessimistic about their business expectations for the coming year than they were in autumn: more than a quarter of companies expect their business to improve (27 per cent), while 16 per cent expect it to deteriorate. The balance of negative expectations fell from 15 to just eleven points, which is below the long-term average of 25 points. In Taiwan, German companies are slightly more positive than the average in Greater China (balance of eleven points). Here, the balance improved by three points from 23 to 26 points. The picture is similar for the People's Republic of China, where companies are also more pessimistic in their expectations than they were in autumn 2024.
In the eurozone, companies are more pessimistic with regard to their business expectations than in their assessment of their current business situation: 37 per cent expect better business, 19 per cent expect worse in the coming year. The balance fell from 25 to currently only 18 points. This is still below the long-term average of 28 points.
In Eastern/South Eastern Europe (excluding the EU) and Turkey, business expectations show that companies expect an improvement compared to the previous survey in autumn 2024. 31 per cent expect their business to improve and only 18 per cent expect it to deteriorate in the coming year. The balance has thus risen from eight points previously to 13 points currently - although the long-term average is still some way off at 19 points.
The business expectations of companies in South and Central America have also deteriorated, albeit at a higher level: the balance stands at 47 points compared to 51 points previously. 57 per cent of companies expect business to improve in the coming year, with ten per cent expecting it to deteriorate.
A similar picture emerges for the Africa, Middle East, MENA and Sub-Saharan Africa regions when assessing business expectations. Overall, companies in all three regions assess their expectations for business in the coming year as predominantly positive. The balance is above the respective long-term average in all three regions.
MENA
Effects of the new US trade policy
The effects of the current US trade policy are being felt everywhere Worldwide, 60 per cent of German companies expect a negative impact on their local business: 17 per cent expect a major impact, 43 per cent expect a minor impact. 34 per cent of companies expect no impact on their business activities, while seven per cent even expect positive effects The assessments of the consequences of US policy differ significantly if one differentiates between the responses from companies that were received before or after Liberation Day on 2 April 2025. Before Liberation Day, 56 per cent of companies expected negative effects on their business, compared to 69 per cent of companies worldwide afterwards.
What impact do you expect the new US trade policy to have on your company's local business?
The company survey took place from 17 March to 15 April 2025. On 2 April 2025, Donald Trump announced extensive tariffs on "Liberation Day". The chart compares the companies' responses before and after 2 April.
The picture is similar for most regions of the world, with the exception of North America. There, the proportion of companies that expect their local business to be adversely affected is 85 per cent (39 per cent major adverse effect; 46 per cent minor adverse effect). The introduction of tariffs and the emphasis on America First are a bad signal for free trade in a highly interconnected, globalised world. Companies - worldwide and in the USA - are dependent on functioning supply chains and reliable international trade relations and are now facing major challenges as a result of US trade policy. Companies in Greater China are more negative about the impact of US trade policy than the global average. 72 per cent of companies expect US trade policy to have a negative impact on their local business, while 23 per cent expect no impact. Five per cent expect a positive impact on their business. Despite the considerable US tariffs on goods from the People's Republic of China, only a slightly aboveaverage number of companies there expect negative effects on their business. This shows that Chinese goods are in demand worldwide, not just on the US market, and that many companies also produce for the local market.
In the Asia-Pacific region (excluding Greater China), companies are slightly less affected: 61 per cent believe that US trade policy will have a negative impact on their local business (21 per cent major impact; 40 per cent minor impact)
What impact do you expect the new US trade policy to have on your company's local business?
Other EU, Switzerland, Norway, UK
Eastern/Southeastern Europe (excluding EU), Turkey
Asia/Pacific (excluding CN)
Greater China
North America
South and Central America
Africa, Middle East
Sub-Saharan Africa
The companies had the opportunity to specify the impact of US trade policy on their company in a free text field. They most frequently cited uncertainty and planning insecurity as a result of the erratic US tariff policy. Companies also fear that the tariffs will drive up prices and demand could fall An unstable US dollar exchange rate, which could affect business, is also cited as a possible negative impact Companies worldwide are also anticipating a decline in trade with the USA, particularly in the automotive industry Some German companies that export their products to the USA are concerned about competitive disadvantages compared to "Made in USA" goods. Some companies that have considered relocating their production sites to the USA would prefer to wait and see for the time being in view of the uncertain situation In South East Asia, companies are assuming that Chinese products could flood the market and that local competitive pressure will therefore increase considerably Of the seven per cent that expect positive effects, some companies that do not operate in the USA and are less or hardly affected by US tariffs are hoping for more trade with other economic areas such as the EU. An increase in exports or foreign direct investment was frequently mentioned. Some companies are speculating on the relocation of production sites from China to their countries and expect to benefit from the supply chain diversification strategies of other players. On the other hand, companies with locations in the USA hope to benefit from "local for local" measures in the USA and the weakening of the US dollar
Risks for German companies abroad
Despite the many geopolitical crises and conflicts, the global economy has developed resiliently in recent years. However, the new quality of the latest trade policy upheavals is having a considerable impact worldwide. Global economic growth is losing momentum. Against the backdrop of major trade policy uncertainty and the associated developments that are difficult to predict, companies around the world are particularly concerned about the economic policy environment
Companies also see the current economic policy environment as the most common business risk (49 per cent, autumn 2024: 47 per cent, long-term average 47 per cent). The most recent business risk of a lack of local demand is now in second place, but still affects 46 per cent of companies (previously 50 per cent). The third most common business risk is the shortage of skilled workers for 34 per cent of companies (previously 35 per cent), followed by high labour costs (33 per cent, previously 31 per cent)
Business risks for companies in the next twelve months (in per cent, multiple answers possible
Spring 2025 Fall 2024
Looking at the different sectors, a similar picture emerges: the economic policy framework is seen as the greatest risk by industrial and construction companies (48 per cent), as well as in the service sector (52 per cent) Retail companies, on the other hand, see demand as the greatest risk (47 per cent), followed by economic policy
A look at the regions reveals differences.
In North America, economic policy conditions are most frequently cited as a risk in a global comparison. For almost three quarters of companies (73 per cent compared to 55 per cent previously), economic policy is the biggest challenge. In second place are trade barriers (57 previously 25 per cent) and in third place the lack of demand (49 previously 45 per cent) All three risks can be attributed to US trade policy German companies based in the USA cite trade barriers or preferential treatment of domestic companies as the most frequent business risk
(71 per cent compared to just 21 per cent previously). The economic environment is in second place with 70 per cent, up from 46 per cent previously Supply chain disruptions are in third place at 41 per cent (March 2024: 16 per cent) Particularly notable in the USA is the increase in risks, which are exacerbated by the current government's trade policy. Companies are concerned about the future of their business and business relationships. However, structural risks such as the shortage of skilled labour, which traditionally represents a major business risk in the USA, are currently becoming less important in comparison.
Business risks for companies in the USA in the next twelve months (in per cent, multiple answers possible)
In the European Union (EU27), 54 per cent of companies see demand as the greatest risk This is nine percentage points less than in the previous survey There was a slight increase in economic policy as the second biggest risk at 49 per cent (previously 48 per cent). With the United States as its largest trading partner, the EU is particularly affected by the consequences of US foreign trade policy. Within the eurozone, economic policy is the number one risk for the companies surveyed at 55 per cent (49 per cent in autumn 2024) Demand is receding into the background, but remains a risk for just under half of the companies (49 per cent compared to 59 per cent previously).
In the entire Asia and Pacific region, 49 per cent of companies see weak demand (increase of six percentage points) and 44 per cent see economic policy as the biggest challenges (decrease of 16 percentage points) In India, the number of companies citing trade barriers as a risk has increased considerably. While only 23 per cent of local companies mentioned this risk in the previous survey, it currently concerns 40 per cent of local companies (increase of 17 percentage points). Companies in the Greater China region (China, Taiwan, Hong Kong) also cite demand as the greatest risk (71 per cent, up from 76 per cent previously), followed by trade barriers (43 per cent, up from 40 per cent) and economic policy (43 per cent, up from 40 per cent). Here too, the new tariff war between China and the USA is most likely the main cause of this development
At the same time, companies in South and Central America are confronted with the economic policy framework (55 per cent overall, previously 60 per cent). In Ecuador in particular, 90 per cent of companies cite this risk (highest in the world) and 70 per cent in Colombia Both countries are dependent on oil exports to the USA and are therefore particularly affected by the current US foreign trade policy. The high proportion in Ecuador is partly due to the presidential election in mid-April, which took place during the survey period
In Africa, Middle East and Africa companies categorise economic policy and exchange rate developments as the main risks. Both risks are cited by 41 per cent of companies in the region, followed by financing risks (37 per cent, previously 40 per cent). The risks are similar in sub-Saharan Africa: Economic policy with 55 after previously 56
per cent and exchange rate in first place with 55 after previously 50 per cent. In third place, companies see financing difficulties as a business risk (50 per cent after 49 per cent previously)
Business risks for German companies abroad in per cent, multiple answers possible
In addition, the companies had the opportunity to name further risks in a free text field In particular, concerns about an escalation of the US tariff conflict and a global recession were mentioned Other business risks include bureaucracy and overregulation, corruption in some places and Chinese competition, which is gaining market share in particular through state-sponsored price dumping
Investment plans of the companies
Companies' investment plans have fallen again against the backdrop of geopolitical tensions The negative trend has continued since spring 2024: 28 per cent (autumn 2024: 30 per cent) of companies are planning higher investments in the next twelve months, while 21 per cent (autumn 2024: 18 per cent) are reducing their capital expenditure. Just under half plan not to change their investment activity. The resulting balance falls to seven points (autumn 2024: 12 points) and is therefore well below its long-term average (14 points) The investment momentum of German companies abroad is therefore slowing once again
Companies' investment intentions (balance of "higher" minus "lower" responses in points)
Other EU, Switzerland, Norway, UK
Rest of Europe incl. Türkiye
Asia/Pacific (excl. China)
Greater China
North America (=USA, Canada, Mexico)
South and Central America
Africa, Near and Middle East
Sub-Saharan Africa
While the USA was still one of the most attractive investment markets for German companies before the survey, the current uncertainty caused by the new government's trade policy has led to drastic cuts in investment plans: only 24 per cent are planning to increase investment in the coming year, while 29 per cent see themselves forced to reduce their investments. The balance plummeted from 19 points to minus five points Investment intentions
are thus at their lowest corona-adjusted level since the survey began - 30 points below their long-term average (25 points).
Investment intentions of German companies worldwide and in the USA (balance in points)
balance USA balance global
The investment plans of German companies in Canada and Mexico are changing similarly. In Canada, only ten per cent plan to increase investments in the coming year, while 38 per cent plan to reduce their investments. The balance thus falls sharply - from zero to minus 30 points In Mexico, the picture from autumn 2024 has also reversed: only half as many companies are planning to increase investment as in autumn (20 percent compared to 41 percent previously), while the proportion with restrictive investment plans has doubled from 21 to 40 percent The balance turns from plus 21 to minus 21 points
The willingness of German companies to invest in the MENA region has decreased slightly compared to autumn 2024 - for the third time in a row. Nevertheless, just under half of companies (46 per cent) are planning to increase their investments locally. This is significantly more than in a global comparison (28 per cent) In the Africa, Middle East and Africa region as a whole, 44 per cent of companies are planning to invest more in the next twelve months
In Asia/Pacific excluding Greater China, companies' investment plans for the next twelve months have decreased slightly again. Only 31 per cent of companies are still planning higher investments, while 13 per cent will have to cut back on their investments in the coming twelve months. The balance fell slightly from 20 to 18 points (spring 2024: also 18 points).
However, the willingness to invest in Greater China is falling again In mainland China in particular, a good one in three companies (33 per cent) are scaling back their investment plans for the next twelve months. Here, companies are once again scaling back their investment plans compared to the previous year.
In contrast to the restrained investment intentions worldwide, 36 per cent of companies in South and Central America are planning higher investments at their locations in the coming year. The balance of investment intentions rises from 19 to 22 points.
In sub-Saharan Africa, too, companies' willingness to invest has increased again compared to the autumn survey. For example, 35 per cent of the companies involved in the region are planning higher investments and only 13 per cent are considering reducing their investments (balance of 22 after 16 points previously).
Employment intentions
Similar to investments, the employment intentions of German foreign companies are also clouding over. The great uncertainty surrounding economic development is causing companies to hesitate when it comes to recruitment. While 31 per cent of companies intend to increase their workforce in the coming twelve months, 16 per cent plan to employ fewer staff. The balance of higher and lower employment intentions has therefore fallen significantly from 21 points to just 15 points.
Employment intentions of companies (balance of "higher" minus "lower" reports in points)
While employment plans for the coming year are being scaled back worldwide, a look at the regions reveals differences.
Employment intentions are by far the highest in the MENA region, although the pace of job creation is slowing here too. 46 per cent of companies are planning to expand their workforce in the coming year and only nine per cent will have to reduce staff. The balance falls from 51 points previously to 37 points currently.
Companies in sub-Saharan Africa are planning to significantly expand their workforce. 38 per cent of companies would like to increase their headcount here, while 10 per cent expect to reduce their workforce The balance rises by a full 20 points from eight to 28 points
Employment intentions are also increasing in Greater China compared to the previous survey 23 per cent of companies plan to expand their workforce, while more than a quarter (27 per cent) intend to reduce the number of employees. Although the resulting balance is an improvement, it is still in negative territory (minus four points after previously minus twelve points) This positive change is particularly evident in mainland China (balance minus four points after previously minus 15 points) In Hong Kong and Taiwan, employment intentions deteriorated in each case.
In South and Central America, employment intentions are also improving, albeit only slightly. The balance rises from 16 to 17 points. Companies in Guatemala, Costa Rica and Uruguay are particularly optimistic, while companies in Argentina, Brazil, Paraguay and Peru are lowering their employment intentions for the coming year.
The outlook for employment in North America is by far the most negative. The balance there fell from 35 to ten points In Mexico, only a quarter of companies intend to hire employees in the coming year, while a quarter of companies also intend to cut jobs. The uncertain economic situation is not only hampering investment, as less production for export to the USA is also having an impact on the number of employees in Mexico and Canada Almost one million skilled workers are employed in the US market by German companies operating there However, economic policy uncertainty is also leading companies in the USA to revise and adjust their employment plans 28 per cent of companies are planning to hire more employees, while 16 per cent want to reduce their workforce. The balance falls from 34 points to just twelve points.
Global challenges in the next five years
Companies are faced with various geopolitical challenges at their international locations and currently find themselves in an overall uncertain macroeconomic and geopolitical environment. The challenges facing German companies worldwide over the next five years are numerous. The slight upturn announced in autumn 2024 came to an abrupt end with the new US administration's trade policy. New tariffs and regulations from the world's largest economic power are keeping companies worldwide on tenterhooks. The impending upheaval in the global economic order is causing great uncertainty. As a result of the tense situation, companies believe that all factors already relevant in 2023 will become even more critical over the next five years Even though some indicators appear to have become less important in the current economic situation, they are still being mentioned by companies more frequently than before.
Global challenges in the next five years (multiple answers possible)
Trade barriers and conflicts
Inflation/monetary policy framework
Fragmentation of the global economy/decoupling
Digital transformation
Cyber security
Security of raw material and energy supplies
Transformation of the economy towards sustainable energy/production
Supply chain diversification
Climate change
Migration
77% Customs duties and countervailing duties
63% Increase in political influence
32% Subsidies
Spring 2025 Spring 2023 among them
Some indicators are currently mentioned more often than in 2023, with trade barriers and trade conflicts being the biggest global challenge over a five-year period: More than twice as many companies as in 2023 see this as a challenge (64 per cent, 2023: 40 per cent) In North America, as many as 83 per cent of companies are convinced of this. The figure is highest for Mexico: 86 per cent of companies see trade barriers and conflicts as the biggest challenge for the next five years. In the USA itself, the figure is still 82 per cent
Three quarters of German companies worldwide see tariffs and counter-tariffs (77 per cent) as the biggest global challenge in the next five years. Two thirds (63 per cent) are critical of the increase in political influence on supply chains. Political influence on supply chains can lead to higher costs and increased planning effort for companies due to regulations in the area of economic security such as divergent export controls or investment audits, but also due to the resulting reporting obligations - and thus stand in the way of the necessary diversification of supply chains. For as many as a third (32 per cent) of companies, subsidies and discriminatory industrial policy represent the greatest challenge in the next five years
The change in the macroeconomic environment is also accompanied by changes in inflation and monetary policy conditions: 42 per cent of companies see this as the biggest global challenge for the next five years. As a result of US trade policy and the associated fear of upheaval in the global economic order, many companies are forecasting a fragmentation of the global economy / decoupling (40 per cent (2023: 34 per cent)) The escalating trade conflict between the US and China is a reflection of increasing protectionism worldwide. Fragmentation of the global economy can also stand in the way of supply chain diversification. The diversification of supply chains and de-risking - and therefore less dependence on uncertain trading partners - are therefore taking on a new significance: compared to 2023, they are still playing a great role for companies A fifth of companies see this as the biggest global challenge over the next five years - compared to 24 per cent previously. Laws and regulations on environmental and social standards are also increasingly influencing how and where companies can set up their supply chains.
Although the progression of climate change is becoming relatively less explosive against the backdrop of other acute challenges, its significance for the global economy is still of great importance in view of the effects of global warming that are being felt worldwide It should not be ignored: A fifth of companies see climate change as one of the biggest global challenges in the next five years (2023: 23 per cent) In addition to the transformation to sustainable energy and environmentally friendly production processes, companies see it as their duty to implement climate protection measures. Factors such as sustainable energy generation and sustainable production methods play a major role here: a quarter of companies see this as the biggest global challenge in the medium term (2023: 25 per cent). Switching to environmentally friendly and sustainable production processes and business activities would require a high level of investment and a reorganisation of numerous processes - be it switching to renewable energies, energy-efficient production processes or the use of alternative or recycled materials. This is an endeavour that is unfortunately losing momentum in the current geopolitical climate The security of supply of raw materials and energy also remains important: 28 per cent of companies are prepared to ensure greater security in the supply of raw materials and energy (2023: 37 per cent). After experiencing disrupted supply chains and shortages of raw materials as well as high energy costs, companies are very concerned about a reliable supply of raw materials and energy. Geopolitical tensions can also result in trade barriers that disrupt raw material and energy supply chains
More than twice as many companies than two years ago see digital transformation and artificial intelligence as the biggest global challenge for them in the medium term (40 per cent compared to 28 per cent previously). Digital transformation includes the introduction of new digital technologies such as artificial intelligence, big data, cloud computing and the Internet of Things. IT infrastructure and business models need to be adapted. At the same time, the threat of cyberattacks is increasing, which can have serious consequences for companies themselves. A third of companies (2023: 28 per cent) see this as a global challenge, also in light of the tense geopolitical situation and the numerous conflicts. Both the digital transformation and cybersecurity require large and substantial investments Global challenges such as climate change and regional challenges such as political tensions can also lead to migration This is perceived as a challenge by 11 per cent of companies (autumn 2023: eight per cent).
Statistical appendix
Analysis of the results by
In each case, balance of good/better answers minus bad/lower answers
Business risks for German companies abroad
multiple answers possible
What impact do you expect the new US trade policy to have on your company's local business?
in per cent
Figures in per cent, multiple answers
Questionnaire
How do you assess the current business situation of your company?
• good
• Satisfactory
• bad
What business development do you expect for your local company over the next twelve months?
• better
• constant
• worse
How do you see the local economy developing over the next twelve months?
• better
• constant
• worse
How do you expect your company's spending on local investments to develop over the next twelve months?
• higher
• constant
• lower
• No investments
How do you expect your company's local workforce to develop over the next twelve months?
• higher
• constant
• lower
Where do you see the greatest risks to the economic development of your company in the coming twelve months? (multiple answers possible)
• Demand
• Financing
• Labour costs
• Shortage of skilled labour
• Exchange rate
• Energy prices
• Commodity prices
• Legal certainty
• Economic policy framework
• Infrastructure
• Trade barriers / favouring domestic companies
• Disruption s in the supply chain (e.g. logistics, lack of preliminary products)
Do you see any other risks for the economic development of your company?
What impact do you expect the new US trade policy to have on your company's local business?
• a major negative impact
• a minor negative impact
• No effects
• Positive effects
From your company's perspective, what are the biggest global challenges in the next five years? (multiple answers possible)
• Fragmentation of the global economy/decoupling
• Diversification of the supply chain/ DeminusRisking
• Climate change
• Transformation of the economy towards sustainable energy/production
• Raw material shortfall and energy supply security
• Digital transformation, artificial intelligence
• Cybersecurity
• Trade barriers and minus conflicts
o Increase in political influence on supply chains (e.g. through laws, trade barriers)
o Customs duties and countercustoms duties
o Subsidies, discriminatory industrial policy
• Inflation/monetary policy framework
• Migration
• Other (free text)