german businesses put on brave face amid china economic slowdown
Last Updated : GMT 07:46:37
Arab Today, arab today
Arab Today, arab today

German businesses put on brave face amid China economic slowdown

Arab Today, arab today

Arab Today, arab today German businesses put on brave face amid China economic slowdown

China's economic slowdown is worrying for German exporters
Frankfurt - AFP

German companies are trying not to let themselves be spooked by the economic slowdown in China, even if they concede they are currently seeing a drop in demand for their products there.

"Of course we're experiencing a fall-off in demand in China at the moment," said Franz Hampel, head of Garant-Moebel, a furniture wholesaler.

"Our Chinese partners have become jumpy. Business has been good for them the past few years. But they're now asking themselves what the future will bring," Hampel said.

Employing a workforce of around 230 and active in around 20 countries, Garant-Moebel opened an office in Hong Kong two years ago where it employs a dozen people.

However, the strong fluctuations in the Chinese currency, the yuan, resulting from the country's recent financial woes, are leading Chinese furniture retailers to roll back business, Hampel said.

Garant-Moebel is not alone in watching economic developments in People's Republic with a wary eye.

"It seems obvious that the period of double-digit growth is behind us," said Jan-Christoph Block, head of international sales at drive systems specialist Getriebebau Nord in Bargteheide, north Germany.

"It's still possible to achieve growth, but it's become more difficult," he said.

Both companies can be seen as representative of the mostly family-owned small and medium-sized enterprises (SME) that form the backbone of the German economy and were quick to establish a foothold in China.

It is not just big companies like Volkswagen, BMW and BASF that are suffering from China's woes, the SMEs are feeling the pinch too.

- 'Enormous potential' -

China's economic growth is projected to slow to 6.7 percent in 2016 -- its lowest growth rate since 1990 -- from 6.9 percent in 2015, according to the latest forecasts from the World Bank.

The slowdown is worrying for German exporters, since China is their most important market after Europe and the United States.

In 2014, Germany exported a total 74 billion euros ($81 billion) worth of goods to China, not including the sales generated by companies' local subsidiaries in China.

According to the specialist consultancy firm EAC, some of the major players listed on the Frankfurt stock exchange generated combined turnover in China of 131 billion euros in 2014, an increase of nearly 10 percent over the previous year.

So it hardly comes as a surprise that the market turbulence in China has left its mark on Germany's blue-chip DAX 30 index, too. It has lost more then seven percent since January 1.

Nevertheless, China's "enormous growth potential remains," said Block of Getriebebau Nord.

"Currently, more than 5,200 German companies are active in the People's Republic, employing a combined workforce of more than one million there," said Alexandra Voss, head of the German Chamber of Commerce in China.

"The economic slowdown in China will certainly not be painless. But the huge growth potential remains," Voss told AFP.

- Exaggerated fears -

A number of companies are hoping to benefit from the massive investment programme launched by Beijing to transform China from the world's biggest factory to the world's leading market place for innovation in services and technology. And the sectors covered by German companies were "particularly well placed" to take advantage of this, said Voss.

UniCredit economist Erik Nielsen also argued that "concerns over China are overdone."

China's "real economy leaves no particular reason to worry, at least not in the short term," Nielsen said.

"Recent indicators suggest economic activity has stabilised and, if anything, it has probably picked up in the last few months."

In November, German factory orders, a key measure of demand for goods in Europe's top economy, beat expectations, driven by rising demand both inside and outside Germany.

"It would be virtually impossible for German companies to report these numbers if China was slowing dramatically," Nielsen argued.

Despite China's current woes, Garant-Moebel chief Hampel remains confident.

"China remains an opportunity, thanks to rising incomes and the fact that more and more people there are able to buy consumer goods," he said.

"Our sales grew in 2015 and we expect them to do the same in 2016," he concluded.

arabstoday
arabstoday

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

german businesses put on brave face amid china economic slowdown german businesses put on brave face amid china economic slowdown

 



Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

german businesses put on brave face amid china economic slowdown german businesses put on brave face amid china economic slowdown

 



Arab Today, arab today
Arab Today, arab today Jordanian woman reveals her project

GMT 00:46 2017 Saturday ,11 November

Jordanian woman reveals her project
Arab Today, arab today Visit Jamaica for more than just sun

GMT 09:45 2017 Tuesday ,21 November

Visit Jamaica for more than just sun
Arab Today, arab today Keep kids busy at Thanksgiving gatherings

GMT 11:14 2017 Friday ,10 November

Keep kids busy at Thanksgiving gatherings
Arab Today, arab today UN warns of conflict in Gaza

GMT 08:39 2017 Tuesday ,21 November

UN warns of conflict in Gaza
Arab Today, arab today Missouri problem mirrors woes

GMT 06:46 2017 Tuesday ,21 November

Missouri problem mirrors woes
Arab Today, arab today
Arab Today, arab today
Arab Today, arab today Australian academic's book pulled

GMT 15:20 2017 Monday ,13 November

Australian academic's book pulled
Arab Today, arab today May under Brexit pressure at EU reform summit

GMT 02:14 2017 Saturday ,18 November

May under Brexit pressure at EU reform summit
Arab Today, arab today Delhi half-marathon to go ahead

GMT 03:51 2017 Saturday ,18 November

Delhi half-marathon to go ahead
Arab Today, arab today The history of solar eclipses

GMT 05:16 2017 Sunday ,20 August

The history of solar eclipses
Arab Today, arab today VW says will invest over 34bn euros

GMT 07:19 2017 Tuesday ,21 November

VW says will invest over 34bn euros
Arab Today, arab today Driverless, electric future just round

GMT 02:45 2017 Monday ,20 November

Driverless, electric future just round
Arab Today, arab today Fedra happy for “Between Two Worlds” success

GMT 09:23 2017 Saturday ,18 November

Fedra happy for “Between Two Worlds” success
Arab Today, arab today paObama climate envoy slams Trump's rejection

GMT 16:04 2017 Friday ,17 November

paObama climate envoy slams Trump's rejection

GMT 12:15 2017 Friday ,17 November

Mona Abdel Ghany increased artistic activities

GMT 11:15 2017 Thursday ,16 November

Angola oil boss sacked by father's protege

GMT 18:41 2017 Friday ,20 October

Designer Aql Faqih aspires to innovation

GMT 11:38 2017 Wednesday ,15 November

Unloved vultures fight for their survival

GMT 11:49 2017 Thursday ,17 August

Egyptian artist presents new collection of designs

GMT 00:54 2017 Monday ,20 November

Mideast in danger as London explores

GMT 03:12 2017 Saturday ,18 November

Prince's vision spurs new Cornwall village

GMT 17:12 2017 Monday ,07 August

Al-Shawaifi reveals secrets of total solar eclipse

GMT 16:53 2017 Tuesday ,05 September

Youssra depended on colored foam
Arab Today, arab today
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube
arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday