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Photo credit: Felix Zeiffer

GBP Monitor: War Consequences and a Possible Raw Material Embargo Dampen Profit Expectations

On 20 March, the government has lifted most of the coronavirus restrictions. However, lifting the restrictions has not eased the burden on the companies, as it was expected. Profit expectations, in particular, are dampened by the war in Ukraine.

According to the April report of the German Business Panel (GBP), corporate profits are reduced by 4.7 percent, as compared to April 2021. In addition, not all companies are still in favor of the planned economic sanctions. Most companies still support the sanctions which have been imposed up to now. The opinions on a possible raw material embargo, however, are mixed. Most of the companies using gas in their production or along the value-added chain evaluate an embargo negatively. 31 percent of those companies expect that it will take them more than two years to compensate for the disrupted gas supply.

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