Germany's economy needs a growth agenda

15 February 2024

Dr Helen Fürst called for a future-oriented growth agenda at the annual economic press conference of the Gesamtverband Kunststoffverarbeitende Industrie e.V. (GKV) in Frankfurt on Ash Wednesday, where the plastics processing industry recorded a decline in turnover of around six per cent to 72.5 billion euros in 2023 and companies' expectations for this year are also subdued.

"The causes of the current economic crisis in Germany are predominantly structural in nature," Association President Dr Helen Fürst is certain. At the annual economic press conference of the Gesamtverband Kunststoffverarbeitende Industrie e.V. (GKV) on Ash Wednesday in Frankfurt, she called for a future-oriented growth agenda. This is the only way that the industry in Germany will be able to pick up speed again in two to three years.

Four drivers for more growth

According to Dr Fürst, in order for the growth agenda to solve the most urgent problems of our economy, it must drive forward the four topics of energy, bureaucracy, investment and digitalisation. After all, companies will only invest in Germany in the future if they see a long-term perspective for themselves. There is a particular need for action when it comes to energy and the associated costs. Although the electricity tax has been reduced to the European minimum rate, this is limited to two years. At the same time, grid operators have announced drastic increases in grid fees, which will cancel out a large part of the relief.

Urgent need to reduce bureaucracy

The constantly increasing flood of new, ever more detailed legal regulations and reporting obligations is also barely manageable for most medium-sized companies. Added to this are additional reporting and verification obligations and - possibly - a new EU regulation against plastic granulate losses. This increasing bureaucracy does not ensure innovation, but jeopardises the existence of companies.

Despite the economic crisis, federal tax revenues are still at record levels. While the state is consuming a lot, important funding programmes for the transformation of the economy are being cut. And from 2025, consumers will also have to pay an additional plastic tax. However, reaching into consumers' pockets will not improve anything for the economy or the environment. Dr Fürst is therefore also calling for the German government to refrain from introducing a plastic tax.

Seize the opportunity of digitalisation

Instead, Germany needs to make more consistent use of the opportunities offered by digitalisation. There is currently a risk that Germany will fall behind internationally in terms of digitalisation. Digital technologies and artificial intelligence are enabling SMEs to counteract the existing labour shortage and manage with significantly fewer workers and skilled workers. However, Industry 4.0 will only provide new impetus for growth and innovation if it makes the transition from model factories to industrial SMEs and helps companies to become internationally competitive again. The basis for this is to consistently set the framework conditions with a digitalisation strategy for SMEs.

Dr Helen Fürst is convinced that this growth agenda can solve the most urgent problems of our economy, restore reliability and lost trust and give people in Germany new confidence.

Here you can find the press release of the annual economic press conference of the GKV.

Source: IK