In his article entitled ‘Germany: the tired man of Europe’ (February 12), John Cassar White misses important elements of Federal Minister of Finance Christian Lindner’s quote.
In his statement at the World Economic Forum in Davos at the end of January of this year, Lindner remarked that Germany is not sick, only somewhat tired after a short night, that is, a very successful time since 2012 and the more recent years of crisis. These have been a wake-up call, and what Germany needs now is a “cup of strong coffee”, meaning structural reforms.
It is true that, in 2023, Germany faced an economically challenging year due to various factors but we expect a positive turnaround and – after mimimal growth in 2024, like elsewhere in the EU – anticipate clear growth again in the following year. There are already positive developments: energy prices have stabilised at lower levels, only slightly higher than before Russia’s war of aggression against Ukraine. The inflation rate in Germany is decreasing, and the labour market remains robust, which will positively influence domestic consumption.
Equipment investments in plant and machinery are expected to increase further, given the high investment needs in the transition to a carbon-neutral economy. However, structural challenges such as labour and skills shortages and bureaucracy continue to burden economic development.
Therefore, we are working hard to address these challenges decisively. The federal government presented a 10-point plan in October 2023, including the promotion of future technologies, a reform to further the immigration of skilled labour, a programme for faster planning and approval procedures, reduction of bureaucracy, updating the National Hydrogen Strategy, and advancing an ambitious trade agenda as well as the sourcing and supply of raw materials.
Today, we no longer import any gas, oil, or coal from Russia
Germany is an industrial nation, and a large part of our prosperity depends on international trade. Changes in global markets affect us easily. The WTO recently noted a weakness in global trade; and we are concerned by the increase in protectionist tendencies. Therefore, Germany continues to advocate for open and sustainable international trade rules, including measures to strengthen the European single market and international partnerships.
Germany was particularly affected by the energy price shock following Russia’s full-scale invasion of Ukraine as we imported a lot of gas from Russia until 2022. However, contrary to the expectations of many, we managed to switch our energy supply within a few months.
Today, we no longer import any gas, oil, or coal from Russia. We were able to ensure our energy supply without experiencing a severe economic downturn. Nevertheless, the aftermath is still noticeable. Therefore, we are even more determined to advance the expansion of renewable energies.
We build on our traditional economic strengths: an innovative medium-sized enterprise sector with many ‘hidden champions’ as market leaders; a diversified industrial sector; a strong vocational training system; a robust infrastructure; and a strong welfare state.
This strong framework continues to apply to businesses: Currently, more than two dozen private-sector projects with an investment volume of over €80 billion are testimony to confidence in Germany as a good place to do business. Germany can rely on the innovative power and competitiveness of its companies in order to foster the green transformation and digitalisation of our economy.
Like many European countries, Germany too witnesses growing support for far-right populists. In order to send a clear message against right-wing extremist ideologies, more than one million people in various big cities and small towns across Germany took to the streets in the past weeks.
This civil society commitment is the backbone of German democracy, and the federal government is politically committed to combatting right-wing extremism and promoting democracy through various programmes and initiatives.
Tanja Beyer is the ambassador of the Federal Republic of Germany.