German firms are feeling optimistic about 2017

Frankfurt am Main (ots) -

- Confidence rises among SMEs and large enterprises
- Domestic demand remains sound as companies hope for a recovery
of export markets
- Upswing will enter fourth year under difficult conditions

Small and medium-sized enterprises in Germany are optimistic about
the year ahead, according to the current KfW-ifo SME Barometer. In
December their business climate rose 1.2 points on the previous month
to 20.0 balance points. The indicator thus gained almost ten points
since its low of February this year. The main factor that drove SME
business sentiment up was their significantly more positive view of
their business situation (+2.5 points to 29.0 balance points). While
their expectations of future business just barely held steady on the
previous month's level (down 0.2 points to 10.8 balance points), they
remain above average.

Germany's large enterprises are even more optimistic about 2017
than SMEs. Their expectations rose by 1.5 points to 11.0 balance
points. Large firms, which are often internationally oriented, appear
to be banking on a recovery of the global economy next year. Since
important emerging economies such as Russia and Brazil will likely
come out of recession, that is definitely realistic. Their situation
assessments were on a similarly positive level as those of SMEs (+2.3
points to 28.3 balance points), so that business confidence among
large enterprises rose 2.1 points to 19.7 points in December. That
was the highest level since July 2011.

"As the year is coming to a close, the German economy remains in
good shape. The Brexit vote in June, the US election in November, the
failure of Italy's constitutional referendum and the resignation of
its prime minister in December, the increasingly difficult situation
in Turkey and the Middle East - none of these many and often
unexpected events were able to inflict any lasting damage on the
positive trend in sentiment", summarised Dr Jörg Zeuner, Chief
Economist of KfW Group. He added that the previously conspicuous gap
in sentiment between SMEs and large enterprises has now closed thanks
to the persistently sound domestic demand, which is now buoyed by
hopes of an at least moderate recovery of export markets.

"Nevertheless, we must not lose sight of considerable political
risks", Zeuner continued. The shape of future U.S. trade policy is
still unclear, elections will take place in the Netherlands, France,
Germany and possibly in Italy, and tough Brexit negotiations will
probably start in the spring. "Since 2017 will have significantly
fewer days, we expect overall economic growth of 1.3%. Germany's
upswing will therefore enter its fourth year under difficult
conditions."

The current KfW-ifo SME Barometer can be downloaded from
www.kfw.de/mittelstandsbarometer

Pressekontakt:
KfW, Palmengartenstr. 5 - 9, 60325 Frankfurt
Kommunikation (KOM) Christine Volk
Tel. +49 (0)69 7431 3867, Fax: +49 (0)69 7431 3266,
E-Mail: Christine.Volk@kfw.de, Internet: www.kfw.de

Original-Content von: KfW, übermittelt durch news aktuell