German Business Insolvencies Surge Amid Economic Challenges

A new study by Allianz Trade predicts a significant rise in company bankruptcies in Germany, driven by economic stagnation and increased costs.

Allianz Trade has revised its forecast, expecting around 23,000 business insolvencies in Germany for 2024, up from a previous estimate of 21,500.
The anticipated rise in insolvencies is attributed to sluggish demand, escalating labor costs, and the burden of repaying COVID-related loans.
Economic weakness in Europe, particularly in Germany, is putting pressure on companies, with many facing higher refinancing costs and increased export risks.
A slight improvement is expected by 2026, with insolvency numbers projected to decrease to 22,100, indicating a potential market stabilization.
Despite current challenges, many German businesses, especially in the mid-sized sector, remain financially robust and are encouraged to invest in sustainable growth.