A recent survey of German companies operating in Central and Eastern Europe (CEE) reveals that the region is expected to become increasingly important as a market and investment location.
More than half of the companies surveyed (55%) anticipate that the economic relevance of the region will grow by 2030.
The survey, conducted by KPMG and the German Eastern Business Association, found that over half of the companies plan to invest in the region by 2030.
The primary focus of these investments will be on expanding or setting up production capacities, with 33% of companies planning to do so by 2030.
Poland, Romania, and Ukraine are said to be the top investment destinations for German companies in the region.
Poland, the largest economy in CEE, is the preferred destination, with 48% of companies already invested and 51% planning further investments within the next five years.
The survey identified security issues, (alleged) corruption, and bureaucracy as the biggest challenges facing German companies in the region.
However, companies also cited several locational advantages, including high domestic demand, availability of qualified specialists, and low labor costs.
More than one in five companies surveyed (22%) are considering relocating production activities from Germany to CEE.
This trend is driven by the well-known weaknesses of Germany as a business location, with companies seeking more favorable conditions in CEE.
The survey highlights the growing importance of CEE as a market as well as a potential investment location for German companies.
With over half of companies planning to invest in the region by 2030, it is clear that CEE will play a significant role in the future of German business.
However, companies must also navigate the challenges and complexities of operating in the region.
KPMG AG Wirtschaftsprüfungsgesellschaft and the Committee on Eastern European Economic Relations surveyed “subsidiaries of German corporations and German companies” with business activities in Eastern and Central Europe for the “German CEE Business Outlook 2025”.
A total of 133 companies took part.
The survey was conducted between 20 November and 31 December 2024 and the questions focused “on the economic prospects of German companies in the region as well as their challenges and business opportunities.”
