1 | AHK World Business Outlook - Fall 2022

AHK
World Business Outlook
Fall 2022
Results of a survey of German chambers ofcommerce abroad, delegations and repre­
sentative offices

2 | AHK World Business Outlook - Fall 2022

Content
Development of the global economy............................................................................................................................................................................ 3
Regional Business Outlooks .............................................................................................................................................................................................. 9
Europe (Eurozone and other EU (incl. Switzerland, Norway, UK)) ................................................................................................................... 9
Eastern and South-Eastern Europe (without EU), Russia, Turkey................................................................................................................. 12
North America ...................................................................................................................................................................................................................... 14
South and Central America ............................................................................................................................................................................................ 16
Asia-Pacific (excl. Greater China) ................................................................................................................................................................................ 18
Greater China ........................................................................................................................................................................................................................ 20
Africa, Near and Middle East ......................................................................................................................................................................................... 22
Statistical annex .................................................................................................................................................................................................................. 24

Methodology
The AHK World Business Outlook is based on a regular DIHK survey of member companies of the German Chambers ofCommerce Abroad, Delegations and Representative Offices (AHKs). It collects feedback from more than 3,100 German
companies, branches and subsidiaries worldwide as well as companies with close ties to Germany in Fall 2022. The sur­vey was conducted from 4th to 23rd October 2022.
41 percent of the responding companies are from the industry and construction sector, 36 percent from the service
sector and another 23 percent are trading companies. Smaller companies with less than 100 employees account for 47
percent of the responses. 26 percent of the companies employ 100 to 1,000 people. Large companies with more than
1,000 employees account for 27 per cent of respondents worldwide.

Imprint
Association of German Chambers of Industry and Commerce e. V.
International Economic Policy, Foreign Trade Law
Publisher and Copyright© Deutscher Industrie- und Handelskammertag e. V.
Postal address: 11052 Berlin | House address: Breite Straße 29 | Berlin-Mitte
Phone 030 20308-0 | Fax 030 20308-1000
DIHK Online : Homepage | Facebook | Twitter | Linkedin | Instagram | Youtube
Editors: Carolin Herweg, Melanie Vogelbach
Graphics: Friedemann Encke, Sebastian Titze
Picture credits: https://www.gettyimages.de/November 2022

3 | AHK World Business Outlook - Fall 2022

Development of the global economy
Economic expectations of German companies abroad
The global economy is cooling off noticeably. The economic effects of the Russian war against Ukraine and China's
zero-covid policy are weighing on the world economy. In Europe in particular, energy prices have risen to an unprece­
dented extent and companies are facing uncertainty about future energy supplies and price developments. Supply
chain disruptions have not yet been overcome - in fact, the continuation of China's zero covid policy poses a risk toglobal supply chains. Supply shortages and high energy prices have caused inflation rates to rise in many countries, insome cases to very high levels, and are reducing consumers' purchasing power. To combat inflation, many central
banks are raising their key interest rates as part of a more restrictive monetary policy - in the USA, the UK and, withsome delay, in the Eurozone. The economic uncertainties pose major challenges for German companies at their inter­national locations, but they are still proving robust facing them - this is shown by the assessments of more than 3,100
companies surveyed by the AHKs in Fall 2022.
On average, 47 percent of the companies surveyed worldwide expect the economic situation at their respective loca­
tions to deteriorate (spring 2022: 37 percent). Only in spring 2020, at the beginning of the Corona pandemic, did morecompanies expect an overall economic slowdown (65 percent). Only 17 percent (spring: 21 percent) of companies ex­pect the economy in their host country to improve in the next twelve months. The resulting balance of better andworse assessments drops significantly for the third time in a row, from minus 16 points in spring 2022 to currently
minus 30 points.

Economic expectations of companies worldwide
Shares in percent, balance of "better" minus "worse" - balance in points
better
100
17

21

22

18

13

constant
13

51

49
53

51

56

53

Balance

36

34

10
25

80
60

worse

27

65

50
48

17
37

32

42
42

47
32

26

27

26

38

34

40

25
27

24

0

47

33

49

40
20

21

17

33

47

41
21

10

36
17

-20
-40

-30

-60
2015

2016

2017

2018

2019

-55
2020

2021

2022

Almost in all world regions the outlook of companies on the economic development in fall is gloomier than in springand expectations are negative in their balance - the only exception is the Africa, Near and Middle East region. Espe­
cially in European countries, which are hit harder by high energy prices than countries in other regions, the pessimistic
outlook prevails and the outlook is more negative than in other world regions. Compared to the previous survey, ex­pectations in North America (USA, Canada, Mexico) have also dimmed considerably and the balance has fallen into
negative territory. In the previous survey, the majority of companies expected economic growth in this region.

4 | AHK World Business Outlook - Fall 2022

Companies in South and Central America are also more cautious about their economic expectations than in the spring.
In China, whose economy continues to be affected by the zero-covid policy and the real estate crisis, the economic
expectations - starting from the low level of the previous survey - deteriorate again slightly and are clearly below the
expectations of the companies in the rest of the Asia-Pacific region. Expectations have improved in the African coun­tries and in the MENA region.

Business situation and expectations, investment and employment intentions
Despite the numerous challenges and the pessimistic expectations for economic development, companies are currently
still reporting a good business situation. At the current margin, there are signs of a slight easing in global supply
chains, which benefits industrial companies in the processing of their orders. Service companies, on the other hand,
can benefit from the easing of the Corona measures. Companies rate their current business as mostly good, almost
unchanged from the previous survey. In Fall 2022, 45 percent said their business situation was good (spring: 48 per­cent), and 45 percent said their current business was satisfactory. However, every tenth company (spring: eleven per­cent) reports poor business. Compared to the previous survey, the balance of good and bad ratings fell slightly and is
now in line with the long-term average (balance of 35 points after 37 points previously). Companies in North America,
Asia-Pacific (excluding China) and Africa, Near and Middle East report better business than in spring. Companies inGreater China have the worst assessment of their current business situation.

German companies abroad - global overview
Balance in points

60
40

Situation
Employment
Expectations
Investments

20
0
-20
-40
-60
2015

2016

2017

2018

2019

2020

2021

2022

The companies' assessment of the future development of their own business is still predominantly positive, but signifi­
cantly worse than their current business situation. Nevertheless, companies in their international locations are gener­
ally more optimistic about their own business than about the economic development of their host country. 37 percentof the companies (spring: 42 percent) expect their business to improve in the coming twelve months. Based on thecurrent situation, 42 percent expect business to remain the same, while 21 percent (spring: 15 percent) expect it toworsen. The resulting balance of better and worse assessments sinks to 16 points (spring: 27 points) and is thus clearly
below the long-term average of 34 points. Overall, however, companies at their international locations are much more
confident about the future than in Germany: there, according to the DIHK business survey Fall 2022, only eight percent
expect their business to perform better in the coming twelve months, but 52 percent expect worse. 1

1 DIHK business survey Fall 2022: https://www.dihk.de/de/themen-und-positionen/wirtschaftspolitik/konjunktur-und-wachstum/konjunkturumfrage-herbst-2022

5 | AHK World Business Outlook - Fall 2022

Analogous to the gloomy business expectations, companies' investment and employment intentions are also shrinking.
Uncertainty about the future development of the global economy is inhibiting companies from making additional ex­penditures or hiring staff. Globally, one-third of the companies (spring: 36 percent) intend to expand investments inthe coming twelve months, 23 percent (spring: 18 percent) intend to invest less. The balance of higher and lower in­vestment spending halves from 18 points in spring to nine points. On average in recent years, the balance of invest­
ment intentions was 15 points. In line with the lower economic and business expectations in Europe, investment inten­
tions have also dropped more sharply there than, for example, in Asia-Pacific (excluding China), Africa, the Near andMiddle East as well as in North America or South and Central America. In Eastern and South-Eastern Europe (as well as
Russia and Turkey) and in China, investment intentions are even turning negative. In these regions, companies arestrictly cutting back on their investment plans.
Although the economic outlook is gloomy globally, companies want to hold on to their workforce as much as possible.
At 35 percent (spring: 37 percent), more than one-third of the companies are planning to increase staffing levels in the
coming months, almost unchanged from the previous survey. Only 15 percent of the companies (spring: ten percent)plan to reduce staff. The balance of higher and lower employment plans falls from 27 points in the previous survey to
20 points. The long-term average is 23 points.

6 | AHK World Business Outlook - Fall 2022

Overview of results by region (shares in percent)Current business situation of local companies
World
Eurozone
Other EU, Switzerland, Norway, UK
Rest of Europe incl. Turkey/Russia
Asia/Pacific (excl. China)
Greater China
North America
South and Central America
Africa, Near and Middle East

45
44
44

45
46
44

37

10
10
12
16
8
18

47
44

48

32

50
62

35

43

3

46
38

50
0

good
satisfactory
poor

20

40

11
12

60

80

100

Business expectations of the companies
World
Eurozone
Other EU, Switzerland, Norway, UK
Rest of Europe incl. Turkey/Russia
Asia/Pacific (excl. China)
Greater China
North America
South and Central America
Africa, Near and Middle East

37
31

42

21
26
30

43

21
22

49
37
44

39

28

17

48

24

54
52
54
0

38
37
36

20

betterequals
worse

41

40

8
11
10

60

80

100

Expectations of the companies about the economic development on siteWorld
Eurozone
Other EU, Switzerland, Norway, UK
Rest of Europe incl. Turkey/Russia
Asia/Pacific (excl. China)
Greater China
North America
South and Central America
Africa, Near and Middle East

17
12
5
7

36

47
53

35
20

75
25
47

14

31

40
21
23

46
42
39

37
38
34

0

10

betterequals
worse

68

22

37

20

30

40

29

50

60

70

80

90

100

Investment intentions of the companies
World
Eurozone
Other EU, Switzerland, Norway, UK
Rest of Europe incl. Turkey/Russia
Asia/Pacific (excl. China)
Greater China
North America
South and Central America
Africa, Near and Middle East

32
32

45
42

21
27

23
26
24

55
33
49

22

16

47
39
36
39

0

31
44
44
43

20

higher
equal
lower

40

35

40

17
20
18

60

80

100

Employment intentions of the companies
World
Eurozone
Other EU, Switzerland, Norway, UK
Rest of Europe incl. Turkey/Russia
Asia/Pacific (excl. China)
Greater China
North America
South and Central America
Africa, Near and Middle East

35
29
32

50

15
17
13

54
55

18

52
44

47

32

18

49

44

7

56
41

0

9

50

31
20

13
14

45
40

higher
equal
lower

30

60

80

100

7 | AHK World Business Outlook - Fall 2022

Risks for German companies abroad
As a result of the numerous crises - especially the Corona pandemic and the Russian war in Ukraine - and their farreaching economic consequences, companies are confronted with numerous business risks at their international loca­
tions. The frequent mentions of geopolitical risks and decoupling as well as an impending recession of the global econ­
omy in the free-text responses are an expression of the growing uncertainty among companies.
The Corona pandemic is not yet over. China's zero-covid policy led to considerable disruptions in Chinese production
and thus in global supply chains, especially in the spring with the lockdown in Shanghai and other major Chinese cities
lasting several weeks. The economic consequences have still not been fully resolved. Even now, (partial) lockdowns arebeing imposed again and again in Chinese cities. In Fall, 42 percent of companies describe supply chain disruptions as
a risk to the development of their business in the coming twelve months. At 58 percent, the number of companies in
Chinese locations and 50 percent in the Asia-Pacific region (excluding China) are above average. 2
The Russian war in Ukraine has led to turbulence on the world markets for raw materials and energy sources. The risksof high commodity prices (42 percent) and high energy prices (41 percent) continue to dominate for companies. Inview of the partial fall in commodity prices, the risk has fallen by 13 percentage points compared to the previous sur­vey (spring: 55 percent). However, more than half of the companies (51 percent) in Sub-Saharan Africa and the MENA
region still mention the risk. Higher energy prices are mentioned somewhat less frequently as a risk compared to theprevious survey (spring: 46 percent) - but it is a central risk in Europe: 57 percent of the companies in the Eurozone
and 65 percent of the companies in the EU countries outside the currency union see energy costs as a business risk. In
the free text responses, many companies also cite the enormous increase in energy costs.

Risks for the global economy in the coming twelve months
in percent, multiple answers possible, *asked for the first time

supply chain disruptions*42

commodity prices

42

energy prices

41

demand

34

46

41
39
40

economic policy
exchange rate

30

33

32
34

lack of skilled workers
28
29

labour costs
24
22

financingtrade barriers / preference of domestic companies

17

legal certainty

15
16

infrastructure

55

6

20

9

Fall 2022
Spring 2022

As a further obstacle to economic development, labor costs are named as a business risk by 28 percent of the compa­
nies, similar to the previous survey. Behind this is also the concern of companies that a wage-price-spiral will develop
with higher inflation rates. Companies in North America (33 percent) and in Europe (Eurozone: 32 percent; other EU

2Further assessments of companies in Asia are shown in the special evaluation of the AHK World Business Outlook.

8 | AHK World Business Outlook - Fall 2022

(incl. CH, NO, UK): 34 percent) mention this risk with above-average frequency. Although the shortage of skilled work­ers continues to be a considerable risk factor, it is slightly less important for the second time - due to the other domi­
nant risks - but still represents a risk for just under a third (32 percent) of the companies.
In addition to supply-side challenges - supply chain disruptions, high energy and commodity prices - companies are
increasingly facing lower demand. Consumers' reduced purchasing power due to high inflation rates is reducing de­mand in general and globally. 41 percent of the companies see lower demand as a business risk - with a seven per­centage point increase compared to the previous survey, the risk has thus increased the most. Particularly in Chinese
locations (58 percent) and in EU countries outside the Eurozone (as well as CH, NO, UK) (55 percent), companies areconcerned about weakening demand. In the free text responses, many companies also emphasize lower demand fortheir products as well as high inflation rates as a challenge.
Measures to contain the Corona pandemic now play a subordinate role in the risk assessment in many countries. The
economic policy framework conditions have become slightly less important as a risk compared to the previous survey(39 percent after 42 percent previously). As in the previous surveys, the risk is mentioned more frequently than on av­
erage by companies in South and Central America (63 per cent).
The risk of fluctuating exchange rates remains at a high level and is mentioned by one third of the companies. The re­strictive monetary policy of many central banks in response to high inflation rates contributes to fluctuating exchange
rates. The Fed's interest rate hikes have led to a strong appreciation of the US dollar against the euro and other curren­cies. This makes commodity imports traded in US dollars more expensive for a number of countries and increases thedebt burden of many developing and emerging countries. High volatility of exchange rates also creates planning un­
certainties for companies. Companies in Africa, the Middle East (54 percent) and Asia-Pacific (50 percent) mention ex­change rate risk particularly frequently.
Uncertainties about business development in the coming months and interest rate increases in the wake of more re­strictive monetary policy are having a negative impact on companies' access to financing. Almost a quarter of thecompanies describe financing as a business risk factor, a slight increase compared to the previous survey (22 percent).
Financing risk plays a particularly important role in Africa, and the Middle East (36 percent) - since the survey began in
2015, financing risk in the region has consistently been higher than in the world as a whole.
Compared to the risks mentioned above, trade barriers (17 percent), legal certainty (15 percent) and infrastructure (sixpercent, the lowest value since the survey began) have taken a back seat compared to the previous survey. In individual
regions, however, they pose specific risks. A quarter (24 percent) of companies in China and in Sub-Saharan Africa andthe MENA region complain about trade barriers and the preferential treatment of domestic companies. Strategies suchas self-reliance or dual circulation are supposed to strengthen the Chinese economy and self-sufficiency. This is also
expressed in discriminatory trade barriers. A third of the companies in Central and South America see a lack of legal
certainty as a major risk to their own business development. At 13 percent, companies in North America criticize theinfrastructure with above-average frequency - as do companies in South and Central America at 12 percent.

9 | AHK World Business Outlook - Fall 2022

Regional Business Outlooks
Europe (Eurozone and other EU (incl. Switzerland, Norway, UK))
The European economy is facing challenging times: Enormously high energy prices as well as uncertainty about futureenergy supplies are particularly dimming the economic outlook. The consequences of the war are felt more strongly
here than in other regions. Germany is the most important trading partner for many countries in the region - with theweakening of the German economy in sight, the outlook of the other countries in the monetary union is therefore also
clouded. While companies are currently still predominantly reporting good business, they are pessimistic about theeconomic development at their European locations. In the Eurozone, only one in eight companies expects the economy
to grow in the next twelve months, more than half (53 percent) anticipate an economic downturn. The balance of bet­
ter and worse expectations drops to minus 41 points (previous survey minus 25 points). In the Eurozone, the risks ofhigh energy prices (57 percent) and commodity prices (44 percent) dominate, along with disruptions in corporate sup­ply chains that have not yet been overcome (44 percent) and concerns about weakening demand (44 percent).
Even more pessimistic is the group of countries outside the common currency area, which also includes Switzerland,
Norway and the United Kingdom. Only five per cent expect economic growth, three quarters an economic slowdown.
The balance plummets to minus 70 points (previous survey minus 31 points) and thus falls to a historic low for thisregion. In a global comparison, the region has the worst outlook. The survey was conducted at a time when the British
government has caused turbulence in the British economy by first announcing and then largely withdrawing stimulus
packages. High energy prices (65 percent) are cited as a business risk here more frequently than in any other region.
Lower demand (55 percent) and high commodity prices (47 percent) also play a significant role.
With regard to the advantages that companies based in Europe see in their locations, the supplier network (Eurozone:
47 percent; other EU: 41 percent), the availability of skilled workers (Eurozone: 41 percent; other EU: 36 percent) andpolitical stability and legal certainty (Eurozone: 35 percent; other EU: 32 percent) are particularly valued in both groupsof countries. In the free-text field, the companies had the opportunity to name further location advantages and partic­
ularly mention proximity to customers, product quality and the central position on the continent. By contrast, energy
costs are the least attractive in global comparison (nine percent in each case) - this is to be seen as a location disad­vantage in global competition.

What do local companies currently see as the advantages of their current locations?

Other

Political stability / legal certainty

Supplier network
50%
40%
30%
20%
10%
0%

Tax burden(Digital) infrastructure

Eurozone

Energy costs

Labour costs

Availability of skilled labour
Availability of raw materials

Other EU, Switzerland, Norway, UK

10 | AHK World Business Outlook - Fall 2022

German companies in the Eurozone
Balance in points
100
80
60
40
Current situation

20

Business expectations
Economic expectations

0

Investment intentions-20

Employment intentions

-40
-60
-80
2015

2016

2017

2018

2019

2020

2021

2022

Risks for German companies in the Eurozone
in percent, multiple answers possible, *asked for the first time57

energy prices
supply chain disruptions*44

commodity prices

44

demand44
37

lack of skilled workers
economic policy

33

labour costs

32
19

financingexchange rate

12

trade barriers / preference of domestic
companies

11

legal certainty

11

infrastructure

Fall 2022
4

Spring 2022

11 | AHK World Business Outlook - Fall 2022

German companies in Other EU countries (plus Switzerland, Norway, UK)
Balance in points
100
80
60
40
Current situation

20

Business expectations
Economic expectations

0

Investment intentions-20

Employment intentions

-40
-60
-80
2015

2016

2017

2018

2019

2020

2021

2022

Risks for German companies in Other EU countries (plus Switzerland, Norway, UK)in percent, multiple answers possible, *asked for the first time65

energy prices

55

demand47

commodity prices

42lack of skilled workers
supply chain disruptions*34

labour costs

34
29

exchange rate25

economic policy
financing

15

legal certainty

14

trade barriers / preference of domestic
companies
infrastructure

11
Fall 2022
2

Spring 2022

12 | AHK World Business Outlook - Fall 2022

Eastern and South-Eastern Europe (without EU), Russia, Turkey
The economies of Russia, Turkey and the European countries in Eastern and South-Eastern Europe outside the Euro­pean Union are facing challenges: The region is heavily dominated by Russia's war against Ukraine, the related sanc­tions against Russia and their impact on the economy. Most countries are in crisis mode with regard to energy supply
and high inflation. Especially the growing energy prices pose risks for production processes in Eastern/South-Eastern
Europe. After the EU states outside the Eurozone, the countries in the region have the second worst economic expecta­
tions: Only seven percent of the companies expect economic growth in the next twelve months, more than two thirds(68 percent) assume an economic downturn. The balance of better and worse expectations drops to minus 61 points.
Companies' business expectations are more pessimistic than in any other region (balance of minus 19 after previously
three points) and the negative voices also predominate most in a global comparison with regard to investment andemployment intentions. The companies see the greatest business risks in particular in the economic policy framework
conditions (55 percent) - an above-average value worldwide - in fluctuating exchange rates (46 percent) and in lower
demand (43 percent).
In turn, almost every second company (48 percent) sees locational advantages in labour costs - more frequently thanin any other region. Companies also value the availability of skilled labour (39 percent) and the local supplier network(33 percent).

RussiaRussia's partial mobilization and the annexation of the four occupied regions in the east and south of Ukraine are afurther escalation of the war. Together with the tightened sanctions, this has an impact on the decisions of foreigncompanies in Russia. In addition, there is an exodus of skilled workers to neighbouring countries. The economic out­
look remains predominantly negative. In particular, companies are affected by disruptions in their supply chains (67percent) and notice low demand for their products (57 percent). Half of the companies (49 percent) see the economic
policy framework as a risk and trade barriers or the preferential treatment of domestic companies pose a risk for 47
percent of the companies. Nevertheless, companies' business expectations as well as investment and employment in­tentions improve slightly compared to the previous survey. The reason for this could be less uncertainty about eco­nomic development than in the spring shortly after the start of the war and the first sanctions.

What do local companies currently see as the advantages of their current locations?
Supplier network
50%
Other

40%

Energy costs

30%
20%
Political stability / legal
certainty

10%

Labour costs0%

Tax burden(Digital) infrastructure

Availability of skilled labour

Availability of raw materials

13 | AHK World Business Outlook - Fall 2022

German companies in Eastern and South-Eastern Europe (without EU), Russia, Tur­
key
Balance in points
100
80
60
40
Current situation

20

Business expectations
Economic expectations

0

Investment intentions-20

Employment intentions

-40
-60
-80
2015

2016

2017

2018

2019

2020

2021

2022

Risks for German companies in Eastern and South-Eastern Europe
in percent, multiple answers possible, *asked for the first time

55

economic policy

46

exchange rate

43

demand38

supply chain disruptions*36energy prices

33

commodity prices
labour costs

30

financing29

lack of skilled workers

28

trade barriers / preference of domestic
companies

27
23

legal certainty
infrastructure

Fall 2022
5

Spring 2022

14 | AHK World Business Outlook - Fall 2022

North America
Due to high inflation rates in the US, the US Federal Reserve has raised key interest rates several times this year. Even
though the US economy grew again in the third quarter of 2022 after two quarters of negative economic growth,
there are still concerns about a recession. This is also felt by companies in Canada and Mexico, which are closely linked
to the US economy as neighbouring countries and important trading partners. Thus, the outlook of companies in theregion on economic development as a whole is predominantly pessimistic. 21 percent expect the economy to brighten,
but twice as many (42 percent) expect it to worsen in the coming twelve months. The balance drops to minus 21
points (previous survey 14 points). Above all, companies are burdened by disruptions in the supply chain (46 percent),
concerns about the economic policy framework (44 percent) and the shortage of skilled workers (42 percent).
Nevertheless, the North American market with - in global comparison - relatively favourable energy prices offers at­
tractive conditions. Thus, the companies assess their current business situation and future business outlook (balance
46 points, worldwide 16 points) more optimistically than in any other region. 62 percent of the companies assess theircurrent business as good, only three percent as poor; the balance has risen by ten points compared to the previous
survey and is far above the global average. Companies' investment and employment intentions are also more expan­
sionary here than in any other region at present.
At their North American locations, companies also see an advantage particularly in the supplier network (50 percent),
as well as in the availability of skilled labour (33 percent) and political stability and legal certainty (31 percent).

What do local companies currently see as the advantages of their current locations?
Supplier network
50%
Other

40%

Energy costs

30%
20%
Political stability / legal
certainty

10%

Labour costs0%

Tax burden(Digital) infrastructure

Availability of skilled labour

Availability of raw materials

15 | AHK World Business Outlook - Fall 2022

German companies in North America
Balance in points
100
80
60
40
20

Current situation

0

Business expectations
Economic expectations-20

Investment intentions
Employment intentions

-40
-60
-80
-100
2015

2016

2017

2018

2019

2020

2021

2022

Risks for German companies in North America
in percent, multiple answers possible, *asked for the first time46

supply chain disruptions*44

economic policy

42lack of skilled workers

38

demand35

commodity prices

33

labour costs
exchange rate25

energy prices

24
18

financinglegal certainty

14

infrastructure

13

trade barriers / preference of domestic
companies

Fall 2022
8

Spring 2022

16 | AHK World Business Outlook - Fall 2022

South and Central America
The countries in South and Central America have become the focus of public debate with regard to the extraction of
raw materials, especially for renewable energies. Expectations for the region to supply the necessary raw materials arehigh. Accordingly, the business expectations of companies in their Latin American locations are significantly more pos­
itive than the global average (balance 41 points, global 16 points). It remains to be seen to what extent these expecta­
tions will materialize. As in the rest of the world, the assessment of economic development is more negative than in
the spring: While 23 percent of the companies expect an economic upswing, two out of five anticipate an economic
downturn. The balance of better and worse expectations drops to minus 16 points (previous survey minus one point)
and thus falls to the level of a year ago. In particular, the economic policy framework conditions - whose stability is,however, particularly relevant for investments - represent a business risk for the companies (63 percent) - in no otherregion is the risk mentioned so frequently. Companies are also affected by disruptions in their supply chains (34 per­cent) and a decline in demand (34 percent), albeit less frequently than the global average.
In South and Central America, too, companies see a location advantage in particular in their supplier network there (37percent). In addition, the level of labour costs (34 percent) and the availability of skilled labour (31 percent) are an ad­vantage for companies.

What do local companies currently see as the advantages of their current locations?
Supplier network
50%
Other

40%

Energy costs

30%
20%
Political stability / legal
certainty

10%

Labour costs0%

Tax burden(Digital) infrastructure

Availability of skilled labour

Availability of raw materials

17 | AHK World Business Outlook - Fall 2022

German companies in South and Central America
Balance in points
100
80
60
40
Current situation

20

Business expectations
Economic expectations

0

Investment intentions-20

Employment intentions

-40
-60
-80
2015

2016

2017

2018

2019

2020

2021

2022

Risks for German companies in South and Central America
in percent, multiple answers possible, *asked for the first time
63

economic policy
supply chain disruptions*34

demand34

legal certainty

33
31

commodity prices

29

financinglabour costs

25

exchange rate

24
21

lack of skilled workers

17energy prices
trade barriers / preference of domestic
companies
infrastructure

15
Fall 2022
12

Spring 2022

18 | AHK World Business Outlook - Fall 2022

Asia-Pacific (excl. Greater China)
It is true that the outlook in the Asia-Pacific region (excluding Greater China) has also become gloomier due to theweakening global economy. However, expectations are far less pessimistic than in other regions of the world - thismay be due to the increased attractiveness of the region as a result of the discussion on the need to diversify supply
chains. The region includes countries in Central Asia to Oceania. On average, 22 percent of companies in the region
expect an economic upswing, while 31 percent anticipate a slowdown. The balance of better and worse assessments
drops to minus nine points (spring 2022: zero points). Only in Africa and the Near and Middle East is the economic
outlook for the coming months more positive. Accordingly, companies' business expectations, investment intentions
and employment intentions are also significantly above the global average. Investment intentions, for example, remain
almost constant compared to the previous survey - while companies in other regions are cutting their investment
budgets. Companies' employment plans are even slightly more positive than in the previous survey.
Companies in the region see supply chain disruptions (50 percent) and exchange rate fluctuations (50 percent) as abusiness risk with above-average frequency. Supply chain disruptions could play a greater role here than in other re­gions due to China's importance as a trading partner and the lockdown-related production and transport problems
there.
In their current locations, companies particularly value the good supplier structure (40 percent). The availability ofskilled workers in the region is also an advantage - 37 percent of companies in Asia-Pacific see this as an advantage as are the labour costs (40 percent). Companies also particularly value the political stability and legal certainty in the
countries (35 percent).

What do local companies currently see as the advantages of their current locations?
Supplier network
50%
Other

40%

Energy costs

30%
20%
Political stability / legal
certainty

10%

Labour costs0%

Tax burden(Digital) infrastructure

Availability of skilled labour

Availability of raw materials

19 | AHK World Business Outlook - Fall 2022

German companies in the Asia-Pacific region (excluding Greater China)
Balance in points
100
80
60
40
Current situation

20

Business expectations
Economic expectations

0

Investment intentions-20

Employment intentions

-40
-60
-80
2015

2016

2017

2018

2019

2020

2021

2022

Risks for German companies in the Asia-Pacific region (excluding Greater China)
in percent, multiple answers possible, *asked for the first time

supply chain disruptions*50

exchange rate

50

commodity prices

43

demand43
38

lack of skilled workers

34

energy prices

32

economic policy

24

financinglabour costs

21

trade barriers / preference of domestic
companies

20
10

legal certainty
infrastructure

Fall 2022
8

Spring 2022

20 | AHK World Business Outlook - Fall 2022

Greater China
In Greater China (PR China, Taiwan, Hong Kong), economic development is marked by the zero-covid policy and thereal estate crisis. In particular, the lockdown in Shanghai and other major Chinese cities in the spring, which lasted
several weeks, led to considerable disruptions in Chinese production and thus in global supply chains, which have still
not been fully resolved. Domestic demand was also slowed down by this. Even currently, numerous cities are still under(partial) lockdowns. Accordingly, the dominant business risks for companies are disruptions in the supply chain (58percent) and weakening demand (58 percent).
Only 14 percent of the companies expect the economy to brighten up in the next twelve months, 46 percent expect aslower pace. Two out of five companies expect the economic development to remain unchanged. The balance of better
and worse assessments falls to minus 32 points (spring 2022: minus 30 points) and is thus below the level at the be­ginning of the Corona pandemic (spring 2020: minus 29 points). The current business situation is assessed more poorly
here than in any other region at present - only in a few individual other countries do companies currently report aworse situation. While positive and negative expectations for the development of business in the coming months
roughly balance each other out, companies are slashing their investment budgets.
In Greater China, companies particularly appreciate the good supplier structure (58 percent) - more often than in any
other region in the world. The availability of skilled workers (38 percent) and labour costs (27 percent) are also an ad­vantage. A third of the companies at Chinese locations see the moderate energy costs there as an advantage, signifi­
cantly more than in other regions of the world. In the free text field, the size of the Chinese market was also named as
an advantage. With a share of around 18 percent of the world's population, China is an important sales market in nu­
merous sectors - and is already the largest sales market for automobiles and the largest market for the chemical in­
dustry worldwide.

What do local companies currently see as the advantages of their current locations?
Other

Political stability / legal
certainty

Supplier network
60%
50%
40%
30%
20%
10%
0%

Tax burden(Digital) infrastructure

Energy costs

Labour costs

Availability of skilled labour

Availability of raw materials

21 | AHK World Business Outlook - Fall 2022

German companies in Greater China
Balance in points
100
80
60
40

Current situation
Business expectations

20

Economic expectations
0

Investment intentions
Employment intentions

-20
-40
-60
2015

2016

2017

2018

2019

2020

2021

2022

Risks for German companies in Greater China
in percent, multiple answers possible, *asked for the first time

supply chain disruptions*58

demand58

commodity prices

38

economic policy

37

exchange rate

3630

lack of skilled workers

27energy prices
trade barriers / preference of domestic
companies

24

labour costs

23
11

financing

9legal certainty

Fall 2022
infrastructure1

Spring 2022

22 | AHK World Business Outlook - Fall 2022

Africa, Near and Middle East
In recent months, the pressure on German companies to further diversify import and export markets has increased
considerably. Cooperation between the German and African economies is benefiting from this. On the one hand, many
African countries offer themselves as alternative suppliers of raw materials. On the other hand, the rise in commodity
prices has increased the possibilities for African governments to expand infrastructure and rely on products and knowhow made in Germany. In contrast to all other regions, the outlook in Sub-Saharan Africa and the Near and Middle
East has improved compared to the previous survey. 34 percent of the companies expect economic growth in their
host countries in the next twelve months, 29 percent expect an economic slowdown. The balance of better and worse
expectations rises to five points (previous survey minus five points). The mood among companies in the region has alsobrightened with regard to their own business. With a balance of 38 points, the current business situation is assessed as
better than in spring (balance 30 points) and better than the global average (balance 35 points). In addition, companies
are more optimistic or expansionary about their business expectations, investment and employment intentions for the
coming twelve months than companies in other regions of the world.
Companies are more concerned than average about exchange rate fluctuations (54 percent), high commodity prices(51 percent) and economic policy conditions (40 percent). In particular, the rise in the US dollar due to the interest rate
hikes by the US Federal Reserve affects the economy in the region: on the one hand, it increases the prices of com­modities traded in US dollars, on the other hand, it increases the debt burden of developing and emerging countries,
which are mostly indebted in US dollars, and causes uncertainty for companies in international business.
As in all other regions, companies benefit above all from the supplier network (44 percent) in the region. In a global
comparison, the companies also most frequently appreciate the labour costs (44 percent) and, on a par with China, thecomparatively low energy costs (33 percent). In the free text field, the growth potential of the economy and the expan­
sion potential in the region are named as further advantages.

What do local companies currently see as the advantages of their current locations?
Supplier network
50%
Other

40%

Energy costs

30%
20%
Political stability / legal
certainty

10%

Labour costs0%

Tax burden(Digital) infrastructure

Availability of skilled labour

Availability of raw materials

23 | AHK World Business Outlook - Fall 2022

German companies in Africa, Near and Middle East
Balance in points
100
80
60
40

Current situation
Business expectations

20

Economic expectations
0

Investment intentions
Employment intentions

-20
-40
-60
2015

2016

2017

2018

2019

2020

2021

2022

Risks for German companies in Africa, Near and Middle Eastin percent, multiple answers possible, *asked for the first time54

exchange rate

51

commodity prices
economic policy

40

supply chain disruptions*

39

energy prices

36

financing

36
28

demandtrade barriers / preference of domestic
companies

24

labour costs

24
22lack of skilled workers

9legal certainty
infrastructure

Fall 2022
7

Spring 2022

24 | AHK World Business Outlook - Fall 2022

Statistical annex
Evaluation of the results by country
Balance of good/better answers minus bad/less answers in each case

Current businesssituation

Business
expectations

Economic expecta­
tions

Investment
intentions

Employment in­tentions

Worldwide

35

16

-30

9

20

Eurozone
FinlandFranceGreece
Italy
Netherlands
Portugal
Slovakia
Slovenia
Spain

34
30
25
64
45
20
32
39
39
26

5
4
-30
26
12
7
10
-22
-16
4

-41
-56
-30
-30
-48
-7
-57
-68
-63
-61

6
-8
19
19
12
14
-10
-8
-26
19

12
15
45
45
22
0
10
-1
-6
28

Other EU, Switzerland, Norway
Denmark
Great Britain and Northern Ire­
land (UK)
Romania
Switzerland
Czech RepublicHungary

32
17
22

-9
28
-3

-70
-66
-74

-3
14
11

19
7
29

50
41
46
34

-20
-12
-17
-35

-67
-71
-68
-67

-20
-17
-18
-26

23
6
27
6

Eastern/South Eastern Europe(without EU), Russia, Turkey
Russian Federation
SerbiaTurkeyBelarus (White Russia)

21

-19

-61

-13

-12

-6
70
58
-8

-36
22
-4
-43

-71
-48
-54
-70

-20
40
-11
-21

-29
48
5
-27

Asia/Pacific (without China)
India
Indonesia
Japan
Korea (South)
Malaysia
Philippines
Singapore
Sri Lanka
Thailand
Vietnam

36
29
56
28
33
25
47
54
10
54
26

27
29
44
26
0
38
48
7
10
43
3

-9
18
8
-12
-56
0
7
-11
-50
-9
-3

19
46
-4
19
-21
30
22
37
-25
21
0

35
21
20
43
37
46
38
46
-40
49
21

Greater China
China, PR
Hong Kong
Taiwan

14
14
3
13

4
5
-7
0

-32
-31
-24
-37

-9
-9
-35
3

14
16
-17
23

25 | AHK World Business Outlook - Fall 2022

Current businesssituation

Business
expectations

Economic expecta­
tions

Investment
intentions

Employment in­tentions

North America (=USA, Canada, Mexico)
CanadaMexico
USA

59
69
55
58

46
35
39
48

-21
-23
-21
-21

22
27
25
21

42
46
45
41

South and Central America
Argentina
Chile
EcuadorGuatemalaColombia
Nicaragua
Peru

32
42
17
23
29
40
32
30

41
0
7
62
57
64
64
56

-16
-61
-59
-13
-19
-16
-29
-26

16
13
0
21
15
4
24
-4

18
16
7
12
24
52
-4
4

Africa, Near and Middle East
Egypt
Iran
Kenya
Saudi Arabia
Tunisia
United Arab Emirates

38
39
-6
18
55
40
62

44
40
17
56
62
47
74

5
-8
-36
18
63
-27
49

21
19
-18
29
38
54
38

27
20
0
24
54
43
59

26 | AHK World Business Outlook - Fall 2022

Business risks for German companies abroad

DemandFunding

Labour costs

Skills shortage

Exchange rate

Energy prices

Commodity prices

Legal certainty

Economic policy framework condi­
tions

Infrastructure

Trade barriers / preferential treat­ment of domestic companies

Supply chain disruptions

in percent, multiple answers possible

Worldwide

41

24

28

32

33

41

42

15

39

6

17

42

Eurozone

44

19

32

37

12

57

44

11

33

4

11

44

Finland

41

11

33

37

4

52

63

4

22

4

7

59

France

45

30

35

45

5

75

60

5

20

5

10

50

Greece

49

26

23

40

11

66

36

4

36

9

11

28

Italy

48

15

23

27

10

67

55

3

37

3

3

40

Netherlands

43

43

57

53

23

57

43

3

0

7

10

23

Portugal

63

20

37

33

7

60

73

13

30

3

7

50

Slovakia

55

12

48

44

0

73

37

5

32

3

5

48

Slovenia

37

20

37

43

2

69

45

4

27

0

2

53

Spain

55

16

26

25

8

64

56

8

38

1

3

49

Other EU, Switzerland, Norway

55

15

34

42

29

65

47

14

25

2

11

34

Denmark

62

17

21

34

14

48

38

3

14

7

7

28

Great Britain and Northern Ireland (UK)

45

8

2

47

0

60

58

23

10

0

38

2

Romania

53

10

53

60

27

83

67

13

30

7

3

60

Switzerland

53

15

29

53

41

29

38

12

29

0

12

50

Czech Republic

63

20

49

46

24

78

37

7

34

5

0

20

Hungary

57

19

49

30

50

77

50

18

27

2

7

42

43

29

30

28

46

36

33

23

55

5

27

38

57

16

13

20

35

3

15

33

49

1

47

67

Serbia

48

22

48

48

22

70

39

0

26

9

4

39

Turkey

31

46

41

25

74

60

50

16

71

3

14

31

Belarus (White Russia)

57

27

14

19

38

14

16

38

78

8

35

0

Asia/Pacific (without CN)

43

24

21

38

50

34

43

10

32

8

20

50

India

39

11

14

18

46

21

57

4

14

7

11

36

Indonesia

48

32

12

20

48

44

40

8

44

4

24

48

Japan

45

10

5

47

76

36

52

2

19

5

10

53

Korea (South)

48

11

44

41

41

33

52

7

19

0

33

56

Malaysia

46

33

29

58

42

33

54

4

46

8

33

50

Philippines

28

32

22

40

43

50

41

22

38

9

15

56

Singapore

46

25

39

39

46

39

39

0

39

7

25

54

Sri Lanka

55

50

25

15

60

30

30

15

80

15

45

50

Thailand

60

17

9

49

37

49

51

9

14

3

11

34

Vietnam

53

21

15

26

53

21

35

12

21

12

15

38

Eastern/South Eastern Europe (without EU,
RU, TR)
Russian Federation

Legal certainty

Economic policy framework condi­
tions

Infrastructure

Trade barriers / preferential treat­ment of domestic companies

Supply chain disruptions
58

39

9

39

2

30

59

28

17

41

0

21

59

23

47

3

27

0

10

57

25

24

35

14

44

13

8

46

54

35

35

38

0

15

15

12

46

32

26

26

18

39

29

71

8

11

39

29

44

21

22

31

11

42

15

7

50

29

25

21

24

17

31

33

63

12

15

34

26

23

16

26

61

13

19

16

77

10

45

48

59

21

24

24

38

14

34

21

69

0

3

28

25

45

30

14

3

17

28

38

64

8

16

28

Guatemala

33

10

29

29

29

19

33

43

57

48

5

38

Colombia

24

28

28

8

48

16

32

28

60

16

16

36

Nicaragua

39

18

11

36

14

36

32

29

61

7

14

43

Peru

33

11

19

15

30

15

48

33

67

11

11

52

Africa, Near and Middle East

28

36

24

22

54

36

51

9

40

7

24

39

Egypt

27

38

24

13

64

37

60

6

39

3

22

36

Iran

19

56

22

33

53

22

22

17

56

19

44

33

Kenya

41

24

15

21

59

44

35

6

41

3

35

41

Saudi Arabia

31

31

37

43

25

28

49

12

26

8

25

46

Tunisia

30

27

23

37

30

50

53

13

53

17

13

40

United Arab Emirates

18

21

23

26

41

21

54

10

36

3

31

51

Energy prices

24

Exchange rate

1

Skills shortage

37

Labour costs

9

Funding38

DemandCommodity prices

27 | AHK World Business Outlook - Fall 2022

Greater China

58

11

23

30

36

27

China, PR

65

11

27

26

30

22

Hong Kong

48

14

21

31

48

45

Taiwan

47

7

17

37

40

North America

38

18

33

42

Canada50

15

42

Mexico

42

16

USA

33

19

South and Central America

34

Argentina
Chile
Ecuador28 | AHK World Business Outlook - Fall 2022

Questionnaire
How do you assess the current business situation of your company?
• good• satisfactory• badWhat business development do you expect for your local company in the next twelve months?
• better• consistent• bad
How do you assess the economic development on site in the next twelve months?
• better• consistent• bad
How is your company's spending on local investments likely to develop over the next twelve months?
• higher• consistent• Low• No investments
How do you expect the number of employees in your local company to develop over the next twelve months?
• higher• consistent• Low
Where do you see the greatest risks in the economic development of your company in the coming twelve months?
(Multiple answers possible)• Demand• Funding• Labour costs• Skills shortage• Exchange rate
• Energy prices• Commodity prices• Legal certainty• Economic policy framework conditions• Infrastructure• Trade barriers / preferential treatment of domestic companies• Disruptions in the supply chain (e.g. logistics, missing primary products)
Do you see any further risks for the economic development of your company?
What do you currently see as the advantages of your current locations? (Multiple answers possible)• Supplier network• Energy costs• Labour costs• Availability of skilled workers• Availability of raw materials• (Digital) infrastructure• Tax burden• Political stability/legal security• Other (free text)