SMALL AND MEDIUM BUSINESSES IN GERMANY ON THE VERGE OF BANKRUPTCY DUE TO FUEL PRICES

The rapid rise in energy prices has jeopardized the work of companies in Germany.  However, the problem does not only concern gas stations and the transport sector.  According to local experts, existing taxes on electricity and the protracted reform of the public transport fare system could lead to bankruptcy of significant number of entrepreneurs.

According to the NEOPresse media, gasoline prices have already exceeded € 2 per liter at gas stations in Germany. The cost of gas also doubled. This raises concerns among businessmen who fear corporate bankruptcies. The media quotes the words of Markus Jerger, head of the Federal Association of Medium Businesses (Bundesverband mittelständische Wirtschaft, BVMW). In his opinion, fuel prices have become an existential issue’ for entrepreneurs.

Jerger believes that the government urgently needs to take action to save companies and the jobs they provide.

According to the head of BVMW, the state continues to benefit from rising prices, while maintaining a high level of taxes. Reducing them to the EU minimum would improve the business environment for many Germans.

Similar measures, according to the head of the German Association of Employers, must be taken in relation to public transport. Even a temporary reduction in travel costs and benefits would help support people during a difficult period.

According to him, the federal authorities continue to pay considerable attention to Russia, which is the main supplier of gas. However, Jerger notes that only now, against the backdrop of an acute geopolitical conflict, the state began to actively negotiate with such oil-producing countries as Qatar.

The oil and gas market, according to the head of BVMW, is what can be called a ‘power economy’, and not a market economy in its normal form.

Is it possible to call a situation in which the free forces of supply and demand stop working a market, Jerger rhetorically asks.