Corporate Bankruptcies Surge in Germany
Preliminary data indicates that the number of insolvencies in Germany experienced a significant increase of 22.9% in October compared to the same period in 2023. Read Full Article at RT.com.
TroibNews 
Economic sluggishness and increasing expenses have resulted in a double-digit insolvency rate.
The Federal Statistical Office reported on Thursday that corporate bankruptcies in Germany have surged over the past year, a trend linked to the country's weak economic performance and rising costs in the EU's largest economy.
Preliminary data indicates that the number of standard insolvencies filed in Germany jumped by 22.9% in October 2024 compared to the same month the previous year.
With the exception of June 2024, the growth rate of corporate bankruptcies has been in double digits since June 2023, according to the press release.
As of August, the transport and warehousing sector was responsible for the highest number of insolvencies, followed closely by the hospitality industry, as noted by Destatis.
"The current wave of bankruptcies is the result of a perfect storm of long-term economic weakness and drastically increased costs," Der Spiegel quoted Steffen Müller from the Leibniz Institute for Economic Research Halle as saying.
Analysts expect that a total of 20,000 company bankruptcies will occur in Germany in 2024, an increase from 17,814 in 2023.
In October, preliminary data from the statistics office indicated a 0.2% expansion of the economy in the third quarter compared to the previous three months, narrowly avoiding a forecasted 0.1% decline that would have led to a technical recession. Economy Minister Robert Habeck described this figure as “a ray of hope.”
A recession is typically defined as two consecutive quarters of economic decline; Germany's GDP shrank by 0.1% during April to June.
In 2023, the German economy experienced a recession, recording an overall decline of 0.3%. The European Commission's latest economic forecast indicated that this year's activity is expected to decrease by 0.1% due to weak domestic and foreign demand for manufactured goods amid high uncertainty.
Germany has faced challenges from elevated energy costs following significant cutbacks in pipeline gas supplies from Russia in 2022 and increasing foreign competition.
According to Alexander Krueger, chief economist at Frankfurt-based private bank Hauck Aufhaeuser Lampe, “The growth outlook is somewhere between stagnation and a snail's pace.”
James del Carmen for TROIB News
The Federal Statistical Office reported on Thursday that corporate bankruptcies in Germany have surged over the past year, a trend linked to the country's weak economic performance and rising costs in the EU's largest economy.
Preliminary data indicates that the number of standard insolvencies filed in Germany jumped by 22.9% in October 2024 compared to the same month the previous year.
With the exception of June 2024, the growth rate of corporate bankruptcies has been in double digits since June 2023, according to the press release.
As of August, the transport and warehousing sector was responsible for the highest number of insolvencies, followed closely by the hospitality industry, as noted by Destatis.
"The current wave of bankruptcies is the result of a perfect storm of long-term economic weakness and drastically increased costs," Der Spiegel quoted Steffen Müller from the Leibniz Institute for Economic Research Halle as saying.
Analysts expect that a total of 20,000 company bankruptcies will occur in Germany in 2024, an increase from 17,814 in 2023.
In October, preliminary data from the statistics office indicated a 0.2% expansion of the economy in the third quarter compared to the previous three months, narrowly avoiding a forecasted 0.1% decline that would have led to a technical recession. Economy Minister Robert Habeck described this figure as “a ray of hope.”
A recession is typically defined as two consecutive quarters of economic decline; Germany's GDP shrank by 0.1% during April to June.
In 2023, the German economy experienced a recession, recording an overall decline of 0.3%. The European Commission's latest economic forecast indicated that this year's activity is expected to decrease by 0.1% due to weak domestic and foreign demand for manufactured goods amid high uncertainty.
Germany has faced challenges from elevated energy costs following significant cutbacks in pipeline gas supplies from Russia in 2022 and increasing foreign competition.
According to Alexander Krueger, chief economist at Frankfurt-based private bank Hauck Aufhaeuser Lampe, “The growth outlook is somewhere between stagnation and a snail's pace.”
James del Carmen for TROIB News
