Nearly one third of German businesses express doubt that they will be able to survive more than three months of restrictive measures introduced by the government over the COVID-19 pandemic, while over 50 percent of companies expect bankruptcies in case of a six-month lockdown, Munich-based Institute for Economic Research (IFO) said in its survey on Wednesday
BERLIN (Pakistan Point News / Sputnik - 29th April, 2020) Nearly one third of German businesses express doubt that they will be able to survive more than three months of restrictive measures introduced by the government over the COVID-19 pandemic, while over 50 percent of companies expect bankruptcies in case of a six-month lockdown, Munich-based Institute for Economic Research (IFO) said in its survey on Wednesday.
"Many German companies feel that the coronavirus crisis threatens their existence ... Of the companies surveyed, 29.2 percent said they could survive for three months or less if the pandemic-related restrictions were to remain in place for a longer period; 52.7 percent could hold out for six months or less," the survey read.
According to the survey, the situation in April was particularly critical in the retail sector, with 44.9 percent of companies believing they will not survive more than three months of restrictions. Over 63 percent of companies expect bankruptcies if the lockdown will last for over six months.
Among service providers, 31.3 percent say they will not survive the three-month quarantine period and 56 percent may go bankrupt six months from now. The situation is more stable in the German industry, where 24 percent of companies have the capacity to survive for at least three months and 48 percent "will be forced out of business in six months or less." The construction industry seems to be the most stable with 20.4 percent of companies fearing bankruptcies in three months or less and 45.4 percent having resources to survive for half a year.
"These are worrying figures that point to a coming wave of bankruptcies," Klaus Wohlrabe, head of surveys at IFO, said as quoted by the press service.
The number of coronavirus cases detected in Germany has reached 157,641 as of midnight Wednesday, while the number of fatalities has grown to 6,115.
In a bid to curb the spread of the coronavirus, Germany has been under lockdown since mid-March. Earlier in April, the authorities began to loosen the restrictions on business, allowing smaller stores, bike shops and car dealerships to reopen. To support small- and medium-sized businesses, families and self-employed citizens affected by the pandemic, the government formed an additional budget of about 156 billion Euros ($169.8 billion) and a stabilization fund of almost 600 billion euros to support major industrial companies. The government has also established a rent-freeze policy and a simplified procedure for additional payments to companies that have shifted their employees to shorter working hours.
