By Maria Martinez

BERLIN (Reuters) – About 80% of German businesses that trade overseas expect a further decline in sales this year, according to Germany’s BGA trade association. They forecast a 2.7% decline in turnover compared to 2024.

> “The outlook for 2025 is bleak,” said BGA president Dirk Jandura. “Small and medium enterprises have lost their trust in politics.”

Another risk for the German economy is the tariffs promised by U.S. President Donald Trump, measures intended to boost U.S. manufacturing.

Jandura indicated that Germany and the EU will have to wait to see Trump’s actions. “I advise no panic, evaluate calmly, and build up a reasonable, strong counterposition.”

He described Trump as a “pragmatic” person who understands that tariffs could lead to prosperity losses in the U.S. within months, as imports would become significantly more expensive.

As Germany prepares for elections on Feb. 23, reviving sluggish growth in Europe’s largest economy remains a central topic of the campaign.

Jandura remarked that German foreign trade has always been a “reliable anchor” for the economy, but the slowdown in the sector will now impact the labor market, with 30% of companies planning job cuts.

He noted that orders are declining, investments are shrinking, and insolvencies are rising.

According to the BGA survey, 36% of companies reported investing less in 2024 compared to the prior year.

“Without a turnaround in economic policy and a clear change following Feb. 23, we will struggle to face these challenges for long,” Jandura stated.

He called for investments in infrastructure, business-friendly conditions, reduction of red tape, and lower energy and labor costs.

PESSIMISTIC WHOLESALE TRADERS

Two-thirds of wholesalers reported declining sales in the second half of 2024, and 40% expect further sales declines in 2025, according to a BGA survey.

The exporters’ association predicts stagnation in wholesale trade for 2025 in real terms and a 0.5% decline year-on-year in nominal terms.

> “The economic engine of foreign trade is not just stuttering anymore; it has noticeably failed,” Jandura said. “We are stuck in the tunnel, but without light.”