40% of German companies fear economy will shrink in 2023: survey

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Four out of 10 German companies are apprehensive of economic contraction due to energy price volatility and supply chain interruptions amid Russia-Ukraine conflict, says German Economic Institute survey

The picture is barely brighter in the German industry, where 39 percent of surveyed companies forecast a decline, driven by a cautious assessment in the consumer and basic industries.

"The risk of a gas shortage in the 2022/23 winter season is no longer as present as it was in the summer of 2022, and energy prices have also retreated since then. However, they remain at a high level and production disruptions cannot be ruled out," the IW said on Monday in the survey seen by the Reuters news agency.

The survey of around 2,500 companies showed that about a third of companies expect output to stagnate, and the remaining quarter predicts business will grow.

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