Germany losing ground in int'l ranking of family businesses: study

Germany is losing ground in an international ranking of the conditions for family-owned businesses, according to a study published by the German Foundation for Family Businesses on Monday.

In a list of 21 industrialized nations analyzed by the Leibniz Center for European Economic Research (ZEW), Germany has lost three positions compared to the previous study conducted in 2018 and only ranked 17th.

With regard to taxation, Germany ranked next to last due to its high business taxes. The study also considered key factors such as labor costs, productivity, human capital and financing.

Germany continued to fall behind internationally with regard to infrastructure both in transport and in information technology. The quality of Germany's infrastructure appeared to be "well behind that of its competitors" in western and northern Europe, but also in North America and Japan, the study found.

On a positive note, the Foundation for Family Businesses study said that public and private debt in Germany were both low. Ninety percent of all German companies are family-controlled, achieving 52 percent of sales and accounting for about 58 percent of all mandatory social insurance employment contracts.

The United States has moved up to first place in the overall ranking. The country's tax reform, including a reduction in corporate tax rates in 2018, is largely responsible for this development. The foundation noted that the United States achieved "outstanding results" in the categories of regulation, financing and energy.

The United Kingdom ranked second, but "the decision in favor of Brexit is taking its toll. No other country has suffered such a sharp drop in points," the foundation noted. The impact of Brexit-related uncertainties is biggest in the categories of infrastructure and institutions.