AHK World Business Outlook

Special survey on the

COVID-19 impact
Results of a survey of German Chambers of
Commerce Abroad, Delegations and
Representative offices (AHK)
 2 | AHK special survey Corona July 2020

Summary
The worldwide effects of the COVID-19 pandemic are Revenue development 2020
an enormous burden on the business of German com-
panies abroad. Travel restrictions, lower demand for NO CHANGE 8%
products and services as well as decreased investments
worldwide are leading to a considerable loss of revenue.
As a result, companies reduce their employment and in- INCRESASE IN
vestment plans and search for new suppliers due to a REVENUE 5%
lack of goods. Given the numerous economic and
governmental challenges that have to be overcome in
DECREASE IN
many countries, German companies do not expect a ra- REVENUE 83%
pid recovery.

Key results:

1. The extent of the crisis is immense:

▪ 63 percent of German companies abroad are affected by travel restrictions and 59 percent face a lo-
wer demand for their products and services.
▪ 83 percent of the companies expect a decrease in revenue, 15 percent at least by half.

2. The crisis is changing business:

▪ 56 percent are planning to invest less, 43 percent are reducing staff.
▪ 38 percent of the companies are searching for new suppliers, mainly in their own country.

3. The crisis lasts longer:

▪ 93 percent do not expect an economic recovery before 2021.
▪ 47 percent complain about a lack of support measures and 52 percent consider the rising govern-
ment debt as a challenge to overcome the crisis.

The AHK World Business Outlook is based on a DIHK survey of the member companies of the German
Chambers of Commerce Abroad, Delegations and Representative offices (AHK). The special survey on the
effects of the COVID-19 pandemic in summer 2020 collects feedback from around 3,300 German compa-
nies, branches and subsidiaries worldwide, as well as companies with close relations to Germany.

48 percent of the responding companies come from the industry and construction sector, 34 percent from
the service and health care sector and 18 percent are trading and logistics companies. Three percent are ac-
tive in the healthcare industry. Smaller companies with less than 100 employees worldwide account for 49
percent of the responses. 24 percent of the companies employ between 100 and 1,000 people. Large com-
panies with more than 1,000 employees account for 26 percent of those surveyed.
 3 | AHK special survey COVID-19 July 2020

What effects of the corona crisis are currently placing a particular

burden on companies?
63%
Travel restrictions
69%

59%
Less demand for my products and services
57%

47%
Investments are postponed / cancelled
47%

43%
Cancellation of orders
48%

33%
Cancellation of trade fairs / events
47%

31%
Liquidity bottlenecks / lack of financing
33%

29%
Problems in the supply chain / logistics
45%

16%
Missing goods / services
29%

Own production losses / absence due to 12%

sickness 22%

4%
Other
3%

July 2020 April 2020

Expected change in revenue in 2020

83% decrease in revenue

Decrease Decrease by Decrease by Decrease

up to 10% 10-25% 25-50% by more than 50 %
2020
July

4% 13% 29% 26% 15% 8% 5%

No Increase in
No assessment change revenue
2020
April

12% 9% 31% 25% 14% 6% 3%

 4 | AHK special survey Corona July 2020

Proportion of companies with expected decrease in revenue in 2020

and expected economic recovery

Eurozone

-83% Eastern/Southeastern Europe

48% 43% -85%
North America

-83% 58% 35%

Other EU China
47% 50% -80% -78%
50% 43% 59% 25%
South and Central America
Africa, Near and Middle East
-83% Asia/Pacific (without CN)
-82%
41% 55% -85%
49% 43%
55% 37%

Revenue in 2020
2020 2021 2022+
Economic recovery

Investment intentions Employment intentions

July 2020 10% 34% 56% July 2020 7% 50% 43%

April 2020 11% 54% 35% April 2020 11% 54% 35%

higher constant less higher constant less

5 | AHK special survey COVID-19 July 2020

38% of the companies are increasingly searching for new suppliers,

thereof in ...

Local / in country 63%

European Union 37%

Germany 31%

Asia / Pacific 18%

North America 11%

Rest of Europe incl. Turkey and Russia 10%

South America 9%

Africa / Middle East 8%

22% of companies are increasingly relocating their sites/production,

thereof to ...

Local / in country 62%

European Union 21%

Germany 19%

Asia / Pacific 13%

South and Central America 10%

North America 8%

Africa / Middle East 7%

Rest of Europe incl. Turkey and Russia 6%

 6 | AHK special survey Corona July 2020

Relocation back to Germany/to the EU

7%
from South and Central America
5%

6%
from Africa, Near and Middle East
5%

3%
from North America
5%

from other EU countries, Switzerland, 4%

Norway 4%

4%
from China
3%

1%
from Asia/Pacific (without CN)
2%

... relocation to the EU (excluding Germany) ... relocation to Germany

When do companies expect the local economy to recover?

Worldwide 7% 50% 43%

China 15% 59% 25%

Eastern/Southeast Europe (without EU, RU, TR) 7% 58% 35%

Asia/Pacific (without CN) 8% 55% 37%

Eurozone 9% 48% 43%

Africa, Near and Middle East 8% 49% 43%

Other EU, Switzerland, Norway 7% 50% 43%

North America 3% 47% 50%

South and Central America 4% 41% 55%

Recovery in the course of 2020 Recovery in 2021 An economic recovery will take longer
7 | AHK special survey COVID-19 July 2020

What challenges do companies see for overcoming the economic

crisis locally?

Rising government debt burden 52%

Lack of business support measures 47%

Travel restrictions 47%

Political environment 47%

Lack of investment from abroad 43%

Challenges in the health system 33%

Exchange rate 28%

Trade barriers / Preference for domestic companies 24%

Capital outflow 21%

Imprint
Publisher and Copyright
© Association of German Chambers of Industry and Commerce e. V.
Postal address: 11052 Berlin | home address: Breite Straße 29 | Berlin-Mitte
Phone 030 20308-0 | Fax 030 20308-1000

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Editorial office
Kevin Heidenreich
http://twitter.com/B030

July 2020