VCI says German chemicals recovery remains ‘fragile’

Frankfurt, Germany – Business sentiment in Germany's chemical industry improved further in September, although underlying orders, production and sales remained weak, according to chemicals industry association VCI.

For the second consecutive month, a majority of German chemical companies assessed their current business situation positively, while expectations moved into positive territory for the first time in more than a year.

Companies are expecting a recovery in export business and are “somewhat more confident” about the coming months, VCI said 30 Sept.

However, the association cautioned that “a self-sustaining and sustainable upswing is not yet in sight,” with private investment and industrial demand remaining at low levels despite “initial signs of stabilisation”.

Orders from both domestic and overseas customers declined again during the summer, with 40% of German chemical companies identifying insufficient orders as a “serious obstacle” to business.

Production and sales have also lost momentum, VCI added.

“We see no sustainable upturn. The recent recovery remains fragile,” said VCI managing director Wolfgang Grosse Entrup.

“Confidence alone is not enough to get production and investment moving again,” he added, calling for action to address high costs and bureaucracy.