According to the credit insurer Allianz Trade, companies worldwide will see an increase in insolvencies for the third year in a row in 2024. “This trend also applies to Germany – albeit with a delay compared to most other European countries,” predict the economists at the Hamburg-based Allianz subsidiary. “According to the Allianz Trade insolvency study, the ongoing economic weakness, structural challenges and tighter financing conditions are likely to bring even more German companies into financial difficulties in 2024.”
The number of bankruptcies among German companies is expected to increase by 13 percent in 2024 compared to the previous year. “This increase has already begun, particularly in the second half of 2023,” said Allianz Trade boss for the German-speaking region, Milo Bogaerts. The number of bankruptcies here has visibly accelerated, with a 25 percent increase compared to the second half of the previous year, “with the hospitality industry, retail, the construction industry and B2B services making significant contributions.” B2B, or business to business, refers to business between companies, not with consumers.
In line with this development, the analysts at Allianz Trade expect the number of company bankruptcies in this country to rise to around 20,260 cases in 2024. It will not be until 2025 that it will settle at a somewhat more stable level of just under 20,000 due to the expected recovery of the German economy.
Worldwide, Allianz Trade economists are expecting a 9 percent increase in the number of cases, “the third escalation in a row this year” in insolvency events. They cite lower growth, trade disruptions and geopolitical uncertainties as key factors for this. “The largest increases are expected in the US (up 28 percent), Spain (up 28 percent) and the Netherlands (up 31 percent). This broad-based increase would result in the number of bankruptcies in 2024 in two of three countries exceeds the number before the pandemic. In 2023, this was still the case in half of the countries, says the head of the Allianz Trade Group, Aylin Somersan Coqui.
However, Allianz Trade “does not expect a tsunami of corporate bankruptcies like that seen after the Great Financial Crisis, when global bankruptcies shot up by 17 percent and 19 percent in 2008 and 2009, respectively.” (dpa)