Latest news with #Wirtschaft
Bloomberg
22-05-2025
- Business
- Bloomberg
German Wage Growth Slows Sharply as Economy Struggles to Grow
German wage growth has eased significantly, and economic weakness suggests future deals will likely be much lower than in the past, according to the Bundesbank. First-quarter negotiated pay, including ancillary agreements, rose just 0.9% from a year ago, compared to a 5.8% gain at the end of 2024, the central bank said Thursday in its monthly report.
Russia Today
17-05-2025
- Business
- Russia Today
Germany cuts tax estimates by over €33 billion
Germany's tax income is projected to drop by billions of euros over the next four years, according to figures released by the country's Council of Economic Experts earlier this week. The forecast cut reflects the economy's sluggish performance and a major tax relief package included in the federal government's budget bill. The federal government alone is expected to collect €33.3 billion ($37.3 billion) less in tax revenue over the five years through 2029, according to estimates published on Thursday. This year, tax income is projected to fall €600 million short of previous expectations, with a significantly larger shortfall of €10.2 billion anticipated in 2026. A slight improvement in tax revenues is expected from 2027 onward. Overall, tax revenues are forecast to fall short by an average of around €16 billion annually compared to the October 2024 estimate, the Finance Ministry said in a statement, adding that the federal government is expected to face an average annual shortfall of about €7 billion. 'The economy remains in turbulent waters,' Finance Minister Lars Klingbeil said in response to the updated outlook, stressing that boosting revenues through higher economic growth 'is the only way to gain new financial leeway.' Klingbeil, who also serves as vice chancellor, acknowledged that the latest revenue figures will complicate efforts to finalize the new government's budgets for this year and next. The federal government ran out of time to pass the 2025 budget after former Chancellor Olaf Scholz's coalition collapsed in November 2024, forcing the country to operate under a provisional budget since the beginning of the year. Earlier this week, Klingbeil announced that a revised version of the 2025 draft budget would be presented for cabinet approval by the end of June. The bill will include tax relief for companies to spur growth and legislation to establish a €500 billion infrastructure fund. The draft 2026 budget is expected to follow soon after. Germany is the only G7 economy to register no growth over the past two years, making the revival of its sluggish economy a top priority for the new government. According to the International Monetary Fund, Germany is projected to remain at the bottom of the G7 in 2025, with just 0.1% growth.
Telegraph
14-05-2025
- Automotive
- Telegraph
You must work harder, new chancellor tells Germans
Germans must work harder and more efficiently in order to fix the stagnating economy, Friedrich Merz, the new chancellor, has said. People should consider giving up their four-day working weeks and work-life balance to become more 'efficient', the leader of the centre-Right Christian Democrats [CDU] said. 'We must work more, and above all more efficiently, in this country,' he said. 'With a four-day week and work-life balance, we won't be able to maintain this country's prosperity.' Mr Merz made the remarks ahead of a major speech on Wednesday afternoon, where he is expected to outline his plan to breathe life into the German economy. It comes after a leading German think tank raised the idea of sacrificing an annual public holiday to support the country's plans for rearmament. The Ifo Institute said Germans should work more and take less time off, a goal that could be achieved by a reduction in the number of annual public holidays, which varies from state to state. Mr Merz, 69m was sworn in as chancellor last week, having comfortably won February's general elections on a pro-business platform and a vow to heavily reduce migration levels. A former BlackRock executive, Mr Merz fears that the German employment system is too generous and too soft, to the point of restricting productivity. Germany's economy, the largest in Europe, is struggling with a third consecutive year of recession, in addition to a shortage in skilled workers and the decline of its car industry. About one in three German industries say they are suffering from a serious shortage in skilled workers and are trying to address the shortfall. Increased competition from China, and disappointing results in the electric car market, have also dented Germany's economic prowess. While previous governments sought to address the worker shortage by wooing migrants from India, Mr Merz capitalised on anti-immigrant sentiment in Germany to secure his election victory. He has also introduced reforms that will allow Germany to take on unprecedented amounts of national debt, as part of efforts to massively increase funding for the Bundeswehr, the German army. The CDU has long argued that poor worker productivity, linked to shorter working weeks, has also contributed to the slump. Mr Merz says he has already agreed with his coalition partner, the Social Democrats [SPD] to an amendment of the 40-hour working week that will make it easier for Germans to work overtime. According to the German Economic Institute (IW), the German economy is expected to contract by a further 0.2 per cent this year and slip into a third year of recession.
News.com.au
14-05-2025
- Business
- News.com.au
Merz vows to rev up German economic 'growth engine'
German Chancellor Friedrich Merz on Wednesday pledged reforms and investment for Europe's biggest economy to transform it once again into a "growth engine" after two years of recession. In his first major speech to parliament, the conservative leader reeled off a string of ambitious plans to revive the struggling economy even as it faces a fresh threat from US tariffs. These ranged from boosting competitiveness to slashing corporate tax rates, fixing clapped-out infrastructure and reducing red tape. "We will do everything we can to put Germany's economy back on the path to growth," he said. "We can, through our own efforts, became a growth engine once again that the world looks up to with admiration." He faces immense challenges: The economy has been hit by a manufacturing slump, high energy costs triggered by Russia's invasion of Ukraine and weak demand in key export markets, particularly China. Deep-rooted problems, from an ageing population to shortages of skilled labour, are adding to the headwinds. A key plan of the new ruling coalition of Merz's conservative CDU/CSU bloc and the centre-left SPD is to set up a fund to boost investment in infrastructure. The new government has agreed on investments of 150 billion euros for this purpose in the current legislative period, Merz said. The fund is to be established after Merz succeeded in pushing changes to the country's strict debt rules through parliament, to allow greater borrowing. In addition, German firms will be offered tax breaks to invest in new equipment and corporate tax rates will be gradually reduced from 2028, he said. Merz said he hoped to "prevent a prolonged conflict in the trade dispute with the United States", adding that cutting levies on both sides is "better than imposing tariffs against one another". President Donald Trump has imposed sweeping tariffs on nearly all US trading partners, with Germany set to be hit hard as it ships huge quantities of its exports to the world's number one economy. Merz, who has vowed to be a "very European chancellor", said Germany was proposing a new European Union "free trade initiative," noting that one in four German jobs depends directly or indirectly on foreign trade. When it came to China, Merz stressed it would remain an "important partner" but that he would keep on pursuing a policy of "strategic de-risking", aiming to reduce heavy economic dependencies on the world's number two-economy. While some economists have welcomed Merz's plans to spend more to get the economy moving again, there have also been doubts about whether his coalition will go far enough in pushing deep, structural reforms.
Bloomberg
08-05-2025
- Business
- Bloomberg
German Industrial Production Increased Before US Tariff Barrage
German industrial production rose in March, a period in which looming trade barriers by the US administration probably boosted foreign demand. Output rose 3% from the previous month, more than predicted by any economist in a Bloomberg survey. That was mainly driven by automotive, pharmaceuticals and machinery, the statistics office said in a statement on Thursday. On a less volatile three-month basis, it was 1.4% higher.
