German Finance Minister Christian Lindner addressed the need for structural reforms to boost Germany’s competitiveness on Monday. He acknowledged that while the country is not the “sick man of Europe,” it is in need of improvement. The German economy was the weakest among its Eurozone peers last year due to high energy costs, weak global orders, and record-high interest rates. This led some economists to dub Germany as “the sick man of Europe.”
Despite being considered healthy, Germany’s 0.9% expected economic growth remains below the 1.4% average for advanced economies in 2024. Lindner emphasized that although Germany’s economy is strong, it is not at its best and is currently facing a downturn, similar to the British economy. During the World Economic Forum in January, Germany was referred to as a “tired man” in need of structural reforms. Lindner highlighted that the country needs to reduce red tape, attract workers into the labor market, and mobilize private investment.
Furthermore, Lindner underscored the importance of creating a single capital market for private investment in the European Union. He believes that this is a more sustainable solution than continually providing subsidies, as it is unlikely that any economy can sustain extensive subsidy payments.