Ifo Investment Survey: western German manufacturers continue to invest

According to the results of the latest Ifo Investment Survey, manufacturers in western Germany plan to increase their investments by more than 6 percent this year over 2007. The responses of the survey participants indicate that in 2007 investments rose by nearly 12%. Some 68% of the enterprises intend to increase their investment spending this year, while 26% plan to invest less than last year. An unchanged investment volume in comparison with 2007 was reported by 6% of the survey participants. For the first time since 1991 capacity expansion was the dominant investment motive in 2007. About a third of capital expenditures in 2007 and also in 2008 falls into the category of expansion measures. Replacement investments, the major investment motive in past years, followed in second place, a motivating factor for more than a quarter of investments.