BERLIN, May 25 (Xinhua) -- The share of innovative companies in Germany "fell rapidly" during the COVID-19 pandemic, with only one in five considered "particularly innovative" in 2022, according to a study published on Thursday by German think-tank the Bertelsmann Stiftung.
"This will have serious consequences for the (competitiveness) of German companies on global markets," Armando Garcia Schmidt, an economic expert at Bertelsmann, said in a statement.
If less German companies consider themselves as technological pioneers or no longer dare to work on breakthrough innovations, "prosperity is at a great risk," he said.
Last year, the number of German patent applications at the European Patent Office (EPO) fell by 7.8 percent to 24,684 compared to 2019. Although this still made the country second only to the United States, the gap with other countries is narrowing.
China has been catching up with the top league, which also includes Japan. Compared to pre-pandemic levels, China increased its European patent applications by more than half to 19,041 in 2022.
According to the Bertelsmann Stiftung, more than one in four German companies postponed or completely canceled planned innovation activities during the COVID-19 pandemic. For companies with no specific focus on innovation, the cancellation rate was almost twice as high.
Germany still accounted for 29 of the 500 companies worldwide with the highest spending on research and development, a recent analysis by consulting firm EY Germany showed. In 2022, the R&D spending of these German companies totaled 68 billion euros (72.8 billion U.S. dollars), 11 percent more than in the previous year.
Only China, Japan and the U.S. hosted more top R&D-investing companies: 38, 98 and 164, respectively. "Companies from Germany do not look bad internationally at first glance. However, the race is on," Henrik Ahlers, chairman of the management board at EY Germany, said earlier this month.
"Germany as a business location is under pressure as probably never before in its history," Ahlers said. "High energy and production costs, difficult-to-source raw materials, uncertain supply chains and significant geopolitical tensions are a challenging mix -- particularly for an exporting nation like Germany." (1 euro = 1.07 U.S. dollar) ■