According to our Spring Survey, the German-British Business community has become more optimistic in comparison to six months ago, not only in terms of the outlook for their own activities in the UK, but also for the development of the UK economy overall. As a result of the increase in confidence, more than 40% of respondents will invest more in the medium term and a similar number expect to employ more staff. The main reason for investing in the UK continues to be the importance of the British market with 70% planning to invest in sales and marketing activities. However, the UK’s appeal as a manufacturing location should not be underestimated, as approximately 15% of respondents plan to increase investment in production and manufacturing activities - a higher share than the manufacturing sector’s overall contribution to the UK economy (10%).
Political uncertainty and the lack of demand (despite the somewhat improving economy) continue to feature most prominently as challenges for our businesses. These are followed by trade barriers, shortage of skills, and regulatory uncertainty. In comparison to our survey results in 2023, energy costs are having a smaller impact on business operations, moving from most (in spring 2023) to third most influential factor (in autumn 2023) and now settling in twelfth position. With regard to long term geopolitical challenges, political “interference” in supply chain structures, the drive to sustainability and the digital transformation is what keeps companies awake at night. These are issues which affect companies in the UK as well as in Germany and beyond, in turn underlining the need to cooperate more closely to support economic growth for all. Therefore, whatever the composition of the next British government we hope that we can move forward along such a path. This being especially important as strong economies are needed to shoulder the burden of addressing the manifold global issues.
Dr Ulrich Hoppe
Director General
German-British Chamber of Industry & Commerce
