An agenda for the new legislative period: Competitiveness and transformation

Since 2018, industrial production has declined, while gross value added remains stable but stagnates. The reasons are a decreasing international division of labor, shorter value chains, and national factors. Additionally, export dynamics are weakening, and Germany can no longer benefit from the global economy as it once did. This is linked to declining price competitiveness, reduced innovation, and increasing geopolitical risks. Insufficient levels of investment, particularly government investments, lag international standards and lead to outdated infrastructure and a lack of modernization. The competitiveness of the German economy is threatened, with stagnant productivity and weak growth projections. The commitment to a climate-driven transformation by 2045 adds further pressure. The new government has to response by focusing on supply-side policies, promoting investment and innovation. Measures like deregulation, tax cuts, and reforms in energy pricing and social contributions are essential. A cohesive strategy between fiscal, monetary, and wage policies is critical for sustainable growth.