With its record low unemployment, thriving Mittelstand companies and consensus-seeking unions, Germany has been held up as a model of economic management at a time when many of its European partners are mired in crisis.

No one knows what will happen in five to 10 years

But as the 10th anniversary of the reforms credited with fuelling Germany’s success approaches, a small but vocal group of politicians, businessmen and economists is sounding alarm bells over what they see as a dangerous policy complacency in Berlin that is putting the gains of past years at risk.

Some warn that Germany could even return to being the “sick man of Europe” within a decade unless Chancellor Angela Merkel takes bolder action to build on the Agenda 2010 reforms her predecessor Gerhard Schroeder unveiled in a speech in Parliament on March 14, 2003.

As southern European countries enact deep structural reforms of their own in response to the euro crisis, the worry is that Germany’s competitive edge will be eroded by rising wages, soaring energy costs and what some see as a growing state role in the economy that is discouraging investment.

Critics also fault Merkel, in power since 2005, for failing to meaningfully tackle a looming demographic crunch that could hit the economy hard from 2020, and for not moving more aggressively to overhaul a complex tax regime and antiquated education system that is producing too few skilled workers.

“No one knows what will happen in five to 10 years, but it is likely that Germany will run into trouble again if new reforms are not put in place quickly,” Roland Berger, founder and honorary chairman of the business consultancy that carries his name, told Reuters.

“We are running the risk of losing competitiveness. Next to nothing has changed in the labour market over the past five years. This government and the one before it have profited from the Schroeder reforms and become complacent.”

No one expects Germany to turn into Greece overnight. Schroeder’s reforms, which reduced taxes, merged unemployment and welfare benefits and increased the flexibility of the labour market will continue to pay dividends for years to come.

Germany’s other strengths – a robust industrial base, network of specialised small-to-medium-sized businesses, dual vocational training system and “social partnership” between companies and unions – give it a distinct advantage over big European counterparts like France and Italy.