BERLIN, March 24 (Reuters) – German companies said before the start of the Iran war that they were growing more pessimistic about their business overseas amid rising trade barriers and mounting geopolitical risks, the German Chamber of Industry and Commerce (DIHK) said on Tuesday.
DIHK head of foreign trade Volker Treier added that the conflict would only worsen conditions by driving up the cost of container shipping and air freight.
“Free global trade is showing ever deeper cracks,” he said.
Some 69% of firms the DIHK surveyed in the first half of February said new trade barriers were hurting their international operations, up 11 percentage points from a year earlier and the highest level since the organisation began collecting the data in 2005.
The outlook was also subdued at that time, with 21% of companies expecting their business to deteriorate, compared with 16% anticipating an improvement.
Tariffs were being felt most sharply in the U.S. market, where 86% of the German firms active reported being affected, DIHK said. Expectations for the year ahead had fallen to a record low.
“The United States is becoming a risk factor,” Treier said. “High tariffs, political volatility and legal uncertainty are making long-term planning increasingly difficult.”
The DIHK surveyed 2,400 German companies with operations abroad in the first half of last month, before the U.S. and Israel launched attacks on Iran.
(Reporting by Maria Martinez; Editing by Hugh Lawson)
