Profits of Germany's manufacturing industry pick up slowly

Source: Xinhua| 2020-10-02 01:27:27|Editor: huaxia

BERLIN, Oct. 1 (Xinhua) -- Earnings in Germany's manufacturing industry in September were "improving only slowly," according to a business survey published by the ifo Institute on Thursday.

The indicator showed a "slight improvement" from minus 43 points in May to minus 32 points in September, according to the survey among 2,200 German companies.

"The coronavirus crisis is still having a direct impact on industrial companies' earnings," said ifo expert Simon Litsche.

The situation in the German clothing industry even "darkened further" in September as the indicator deteriorated to minus 94 points, according to the ifo survey which is conducted twice a year.

Year-on-year sales in Germany's clothing industry fell by almost 20 percent in the first half of 2020, GermanFashion announced in August. According to the industry association, the COVID-19 pandemic had plunged the country's fashion industry into a "deep crisis."

China remained the strongest import country for the German clothing industry, although imports dropped by almost 18 percent in the first half of the year, GermanFashion noted. After China, the main import countries were Bangladesh, Turkey and India.

The situation in Germany's important automotive industry improved at a low level in September while in mechanical engineering, the indicator rose from minus 48 to minus 29 points, the survey found.

However, the Mechanical Engineering Industry Association (VDMA) said on Monday that "interim hope of a rapid economic recovery has given way to slightly increased skepticism" among many mechanical and plant engineering companies in Germany.

A survey among VDMA members showed that only 18 percent of the mechanical and plant engineering companies in Germany expected a return to the pre-crisis levels in 2019 before the end of next year.

The business situation for German machinery and plant manufacturers in China "continued to improve, albeit no longer as strongly as in the previous surveys," VDMA announced last week. The mood brightened considerably as only 17 percent of companies assessed the impact of the COVID-19 pandemic as great, compared with 46 percent in April.

Even before the COVID-19 crisis hit Germany, the ifo indicator for the earnings situation in the German manufacturing industry decreased as the industry was hit by a recession. The indicator already turned negative at minus seven points in September last year. Enditem