German companies face a wave of insolvencies

The difficult economic situation that persists in Germany continues to affect the business environment, pushing more and more companies towards bankruptcy, according to an article published by the German daily Zeit at the end of last week. The cited source states that, according to data published by the Federal Statistical Office, the number of insolvency applications recorded a new increase in March, rising by 5.7% compared to the same month last year. It is worth noting, however, that the growth rate remained in the single digit range for the first time since June 2024 (+6.3%).

According to the data presented by the German daily, in January 2025 local courts registered 1,830 corporate insolvency cases, 12.8% more than in January 2024. These involve creditors' claims totaling 5.3 billion euros, a notable increase compared to January 2024, when claims were below 3.5 billion euros. The most affected sectors remain, as in previous months, those of warehousing and transport, where companies were forced to file for insolvency more frequently than in other areas. During the whole of 2024, district courts received 21,812 insolvency applications - an increase of 22.4% compared to 2023, when a significant jump of 22.1% had already been recorded. This is the highest annual value recorded since 2015, when 23,101 cases were reported. Moreover, the current figures are approaching the levels recorded during the 2009 financial crisis, which reflects the severity of the economic situation in Germany, the cited source states.

The Chambers of Industry and Commerce of the German states warn that this wave of insolvencies is far from over, the article in the Zeit daily shows. According to economic studies carried out by experts from these institutions, small companies are the ones that most often face liquidity bottlenecks, which makes them even more vulnerable. DIHK chief analyst Volker Treier emphasized to the Zeit daily that this represents a clear alarm signal for the government coalition, which must take quick and concrete measures to support the economy and avoid an even deeper crisis.