According to reports, the German Foreign Trade Association (BGA) warned on Wednesday (12th) that due to the rapid spread of the highly contagious Omicron variant of the virus, large-scale supply chain disruptions are expected, but such disruptions are expected to be temporary.
German industry has been hit by a shortage of chips and other components, and the rising number of confirmed cases of the new crown pneumonia, which began in 2022, has also clouded the outlook for German retailers. While hospitalizations and critical illnesses haven’t increased much, sick leave due to Omicron is posing a new threat to the economic recovery.
“There is currently no risk of collapse, but large-scale disruptions to the supply chain are expected, and such situations are expected to be temporary,” said BGA chairman Dirk Jandura.
Jandura also said that while many retailers around the world have taken action to make supply chains more flexible, disruptions to the global freight network might still occur. At present, it is difficult to ensure that it can be protected from the impact of the global epidemic, and the government is called on to support the industry by reducing energy and electricity prices.
According to previous survey data by the German Chamber of Commerce and Industry (DIHK), a whopping 83% of German companies said that sales fell because orders might not be fulfilled. A quarter of the companies surveyed had to cut production plans or even suspend production.
Volker Treier, a foreign trade expert at DIHK, said: “The shortage of raw materials and supply chain problems are causing a comprehensive impact on the German economy. According to the current development, it may significantly complicate the progress of economic recovery following the epidemic.”
DIHK also pointed out that it is worrying that the number of confirmed cases continues to rise despite the current shortage of personnel in the logistics industry. The agency also warned that the related impact may further impact industries such as food retail and medical production.
Esben Poulsson, chairman of the International Maritime Conference (ICS), has previously said that the worst of the global supply chain is over, but not all the problems facing the shipping industry have disappeared. challenge.
