“This causes significant losses in growth and prosperity”

The companies in northern Germany are looking to the coming year with great concern - at least that is clear from the assessments of association representatives, who gave an outlook for 2023 on Wednesday, combined with clear demands on politicians. Without action, the energy crisis and inflation would leave their mark.

“The high energy prices and the weakening economic prospects will present the economy in Hamburg and Schleswig-Holstein with major challenges. Against this background, investment activity is declining considerably, both nationally and internationally. This harbors the risk that our economy will continue to lose ground in global competition," said Philipp Murmann, President of the Association of Business Associations in Hamburg and Schleswig-Holstein (UV Nord). The energy crisis is the main trigger for inflation, recession and loss of prosperity. It is now the task of the federal government to create economic prospects and confidence in this tense situation by securing the energy supply at competitive prices. Murmann: "We will only be able to prevent de-industrialization in Hamburg and Schleswig-Holstein if we take swift action."

Matthias Boxberger, Chairman of the Board of Directors of the Hamburg Industry Association (IVH), also emphasized how much the overall situation would put Hamburg's industrial companies under "mighty pressure". He therefore also turned to the state government: "In order to support the economic opportunities in Hamburg, the Senate must declare a moratorium on all taxes, fees and charges for the industrial location of Hamburg for the next two years as soon as possible. The historic energy price shock must not just be sat out, supportive intervention must be taken now.” Otherwise, the danger of de-industrialization would be accepted and even promoted.

Both heads of the association also received support from academia at an event hosted by the Deutsche Bundesbank in the Hotel Atlantic. Stefan Kooths, Director of the Research Center for Business Cycles and Growth at the Kiel Institute for the World Economy (IfW), said: "The German economy is drifting in difficult waters. The post-pandemic recovery phase was abruptly interrupted by the energy crisis resulting from the war in Ukraine. Economic output continued to trend upwards into the third quarter; However, this is due to catch-up effects that should not hide the fragile economic situation.” With the energy crisis, the location conditions in Germany suffered again – and significantly so. But Kooths also looked at longer lines of development: “The deterioration that has been creeping in for years is also leaving its mark more and more clearly. Even if a new energy policy strategy on the part of the federal government is now a priority, the other location factors should not be forgotten. Otherwise, a reluctance to invest as a result of increased uncertainty will turn into an investment sclerosis as a result of setting the wrong course.”

However, there is also a northern German industry that can hardly run with strength: Germany's shipping companies are still almost all fully utilized despite the corona pandemic and the Ukraine war. The upturn has reached even the smallest ship owners, in 93 percent of German ocean-going shipping companies all ships are fully utilized, according to the 14th shipowner study, for PwC Germany from May 12 to June 13, 106 decision-makers in German ocean-going shipping companies called by telephone had questioned. The future is also characterized by confidence: Three out of four shipowners are expecting growth.

"Unemployed container ships have become an absolute rarity," said André Wortmann, head of the Maritime Competence Center at PwC Germany. The reasons are catch-up effects in the trade backlog caused by the pandemic and the structural changes in the industry since the financial crisis of 2009. "Today, the problem is no longer overcapacity with a lack of demand, but on the contrary a lack of transport capacities with a sharp increase in demand," said Wortmann's deputy Burkhard Sommer.

74 percent of those surveyed expect growth in the next twelve months - after only 33 percent in the first Corona year 2020. However, only almost two thirds of the shipowners still assume that the global volume of cargo will increase in the next five years. Last year it was 75 percent. According to the shipowners, the end of the road seems to have been reached even with the recent massive increase in charter rates. 62 percent expected stagnation, albeit at a high level.