Perspectives from ISB

Mittelstand commonly refers to family-owned small and medium-sized enterprises in German-speaking countries, especially in Germany, Austria and Switzerland. The importance of this group of companies can be gauged from the fact that the Mittelstands account for almost 55 per cent of Germany’s economic output.

In the recent past, these companies have relied on Chinese markets to compensate for weak demand in domestic growth. However these companies are seeing their exports decrease because of the slowdown in China, where growth in 2015 was the slowest in 25 years, sparking concerns. Exports account for just under half of the German economy and contracted in the final quarter of 2015 for the first time in three years.

Many business leaders among the Mittelstand, however remain optimistic about the long term trends in the Chinese market as well their superior technical capabilities which they argue would help them ride over this crises.

Source: Financial Times, March 30, 2016