11:26 | 01/01/2018 Global Economy
More than half of Germany's industry associations have shrugged off worries about US protectionist policies and Brexit, and are more positive about their situation than they were a year ago, a business survey has shown.
A poll conducted by Germany's IW economic institute has shown that 26 of 48 industry associations were more upbeat than they were at the end of 2016 and more than two-thirds expected firms in their sector to produce more next year than this.
According to the survey released Wednesday, only two sectors were pessimistic — the food industry, which is worried about tougher competition and higher costs, and sections of the cooperative banking sector which are suffering from low interest rates and margins.
"Despite the protectionist policies of US President Donald Trump and prospect of Brexit, investment in Germany rose this year and will strengthen further in 2018," said IW in a statement.
Investment in productivity
The IW said 24 of the 47 industry associations which gave investment estimates, expect higher spending levels from their member companies.
The investment drive is probably the result of a shortage of skilled labor in Germany, which the IW think tank described as "the main factor" holding back an even stronger expansion of Europe's biggest economy.
"The production prospects in the German economy could be better if more skilled workers were available," said IW Director Michael Hüther.
Most economists expect the German economy to grow for the ninth consecutive year in 2018. Earlier this month, the Ifo institute forecast 2.6 percent growth for next year, following an expected expansion of 2.3 percent for this year.
A separate survey of 820 mostly family-owned businesses, showed that 69 percent expected improvements in their operating business next year, up from 59 percent a year ago.