For the first time, German companies doing business abroad regard growing protectionism and trade barriers as their top risk, according to a survey published Tuesday by a business group that calls on the Group of 20 leading nations to push for fair and free trade at their meeting later this week in Germany.
The survey of 4,000 German companies doing business abroad was conducted by the DIHK Chambers of Commerce in May. While it shows that a majority of 56% expect their business to grow over the next twelve months, the findings also highlight the vulnerability of the country's export-oriented economy to global developments.
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"Every second company sees in economic policy conditions a risk to its business in the coming twelve months--more than ever before," said Volker Treier, who is DIHK deputy managing director.
"The main reasons for this are Brexit, trade policy comments by the U.S. government and the growing protectionism in many regions of the world."
He said nearly one in four companies sees its business activities at risk due to growing trade barriers.
World leaders meeting in Hamburg on Friday and Saturday should therefore put this issue on their agenda, Mr. Treier said.
"These warning signals shouldn't be missed," he said. "The G-20 should send a clear message in favor of free trade and fair competition at their summit in Hamburg. Clear support for closer international cross-border cooperation is now urgently needed because economic growth is no sure-fire success."
The warnings came as President Donald Trump has pursued an "America First" policy and questioned some global trade agreements that Washington believes disadvantage the U.S.
German officials expect G-20 talks in Hamburg to be tough because the U.S. has given no indication that it might relax efforts to rebalance the terms of global trade in favor of the U.S.
But German companies are also concerned that the U.K.'s decision to leave the European Union could make trade between Germany and Britain more difficult if London opted for complete departure from the EU's single market that allows restriction- and tariff-free trade between the EU and Britain.
Already, German exports to and imports from the U.K. have declined since the U.K.'s Brexit vote 12 months ago, according to DIHK.
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(END) Dow Jones Newswires
July 04, 2017 03:14 ET (07:14 GMT)