Germany: 80% of SMEs Expect Recession by 2025
Germany is increasing its gas consumption, and electricity imports from abroad are skyrocketing, for which German companies paid 5.3 billion euros in 2024
The results of an opinion survey conducted among managers of small and medium-sized enterprises (SMEs) in Germany by the German Federal Association of SMEs (BVMW) speak very clearly: 80% of German SMEs “expect a rapid economic downturn in 2025.” At the same time, 40% of entrepreneurs of small and medium-sized German companies said they “recorded a significant drop in turnover in 2024,” while 42% of those surveyed also said they “decided to reduce investments to the minimum allocated for 2025.”
One of the most unfortunate aspects of the economic policy of the outgoing government of German Chancellor Olaf Scholz is related to the “accelerated and at any cost” energy transition. Renewable sources of electricity, from solar to wind, cannot even minimally meet the energy needs of German industry: as a consequence, German gas consumption rose again by 5.8% in the fourth quarter of 2024 compared to the same period in 2023. According to statistics published by the Bundesnetzagentur (BNETZA), Federal Agency for Network Control, compared to the previous year, German industry in 2024 “recorded a 9.1% increase in gas consumption.” The domestic economy and SMEs cannot spend astronomical amounts on gas and electricity: gas consumption growth between October and December 2024 is still at 2 percent.
In addition, after the closure of German nuclear power plants and poor green power generation, Germany had to import an astronomical 77,000 gigawatt hours of electricity in 2024. According to the same BNETZA report, “German importers had to pay a total of €5.3 billion for electricity bought abroad.”
