The German economy is weakening and many companies are in a bad mood. Before the cabinet meeting next week, associations are making clear demands on the government, such as tax cuts and a reduction in bureaucracy.
Because of the tense economic situation in Germany, trade associations have called for a relief package for companies. Before the cabinet meeting next week in Meseberg, the President of the German Chamber of Industry and Commerce, Peter Adrian, told the dpa news agency: “Almost a year ago, the federal government decided on a so-called burden moratorium. Since then, however, the burden on companies has increased significantly.”
From the point of view of entrepreneurs, more and more obligations, requirements and restrictions are coming from Berlin and Brussels. A clear change of course is needed – above all, more speed for all planning and investment projects. This helps with the expansion of renewable energies and the renovation of bridges and schools as well as with digitization.
family business with a 10-point plan
After a difficult winter, growth did not gain momentum in the spring either. In the second quarter, gross domestic product stagnated compared to the previous quarter.
The Foundation for Family Businesses and Politics calls for competitive conditions: deindustrialization and the ongoing exodus of companies must be stopped. The association summarizes specific demands in a 10-point plan: EU “over-regulation” must be stopped and the reduction in bureaucracy pushed forward as quickly as possible.
In addition, a reduction in corporate tax is necessary and there must be security of supply and planning when it comes to climate protection. Labor costs would also have to be reduced, productivity boosted and the administrative burden relieved in order to fulfill its core tasks.
Medium-sized companies see “new dimensions”
The association of medium-sized companies is also alarmed: In a survey, more than 62 percent of the companies surveyed described the situation as difficult, and more than one in four companies even described the situation as very bad. Almost every second company surveyed does not want to hire any new staff in the next twelve months – more than seven percent of the companies are considering job cuts. The Federal Managing Director of the Association of Small and Medium-Sized Enterprises, Christoph Ahlhaus, said the results of the survey moved into a “new dimension”.
In the survey, 37 percent of the companies surveyed named high taxes and levies as well as high energy prices when asked what the greatest risk for the company was. This was followed by bureaucracy in Germany and the EU and the increasing shortage of skilled workers. With a view to the cabinet meeting, the federal association called for a “political restart”.
economy for industrial electricity price – Scholz against it
In an interview with the dpa, the head of the institute of German industry, which is close to employers, Michael Hüther, also called for relief: The federal cabinet should now quickly ensure viable energy prices and reduce or abolish the electricity tax, reform the network charges and decide to introduce the industrial electricity price. The subsidy is controversial in the traffic light. The SPD parliamentary group and the Greens are in favour, but the FDP and Chancellor Olaf Scholz continue to be skeptical.
There was agreement that electricity prices would have to go down, Scholz told the newspapers of the Bayern media group. In order to permanently subsidize the price of electricity, however, “we not only lack the money, but also the legal options”. That is why the federal government is primarily focusing on a faster expansion of wind power and solar energy. As a result, the price of electricity would be lower in the medium term than in countries that rely on nuclear power.
Buschmann relies on Lindners Growth Opportunity Act
The Federal Cabinet meets on Tuesday and Wednesday for its retreat in Meseberg. Federal Justice Minister Marco Buschmann (FDP) called on the traffic light coalition partners in advance to prioritize economic growth in Meseberg. “We need a clear priority on growth and prosperity. Because before distribution comes earning,” said Buschmann of the “Welt am Sonntag”.
He criticized Federal Family Minister Lisa Paus (Greens) for her opposition to the growth opportunities law of Federal Finance Minister Christian Lindner (FDP). The law provides for billions in tax breaks for companies. Paus had blocked the bill in the cabinet last week in a dispute with Lindner about basic child security. It is important that the Growth Opportunities Act comes quickly, said Buschmann. “In our economic situation, we cannot afford any further delay.”
Despite all the worries from the economy, the Chancellor sees Germany well positioned for the future. The Federal Republic has “the best prerequisites for us to play in the top league technologically in ten, 20 and 30 years,” said Scholz in an interview with the newspapers of the Bayern media group. “We must not badmouth Germany as a business location,” he said. Germany continues to have good economic prospects.