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Thousands of German companies may go bankrupt in 6 months if energy prices do not fall

This is what the Chamber of Industry and Commerce of the country warns. In addition, the increase in electricity prices may cause companies to decide to increase their investments in other countries, said an economist.

Tens of thousands of German companies may go bankrupt in the coming months due to the increase of energy prices, stated this Friday Peter Adrian, president of the country’s Chamber of Industry and Commerce, quoted by the DPA agency.

“If energy prices do not decrease significantly, the lights will go out in tens of thousands of companies in the country in, at most, six months” , affirmed this Friday to the Rheinische Post newspaper.

Due to the rise in the price of electricity, several companies are afraid that production within the country may no longer be profitable, the agency notes.

Although it may seem that payments for energy do not represent such a large proportion of the total expenses of companies, a sharp increase in price can “affect the competitiveness of those sectors that engaged in fierce international competition,” said Institute for Economic Research economist Oliver Falck. Furthermore, he added that many companies already have quite low profitability due to competition.

In that context, Falck predicted that energy-intensive producers might decide to move their activity to the Foreign. In this regard, a spokesman for the German Machine and Plant Construction Association (VDMA) stated that companies will not make a decision on their relocation just because of rising energy prices, but “strongly rising energy prices can , of course, tip the balance in some cases.”

Earlier this week, the Financial Times reported, citing Hendrik Neumann, technical director of German power operator Amprion, that Berlin could reduce temporarily electricity exports to France and other European countries during the next winter season.

“We assume a very stressful during the coming winter”, assured the senior executive of Amprion, who added that the current energy crisis in Europe is caused, to a large extent, by the anti-Russian sanctions derived from the conflict in Ukraine. He also stressed that other factors that aggravate this problem are related to the permanent closures of nuclear power plants in France, as well as the interruption of coal deliveries caused by low water levels in the main rivers.

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