Business associations call for new strategy for global success

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War, energy prices, inflation, bureaucracy, supply chains, skilled workers, climate change: the list of problems facing the German economy is getting longer and longer. Demands for the future are getting louder.

The four business associations urge cutting red tape and taking various measures to maintain global competitiveness (iconic image) © Photo: Gina Sanders / Fotolia

According to the major German business associations, the situation of industry, trade and commerce is extremely critical due to unnecessary bureaucracy, high taxes and expensive energy. Currently, a large number of handicaps have to be dealt with, said Siegfried Russwurm, President of the Federation of German Industries (BDI).

He made his comments ahead of the traditional top-level meeting of the four major German trade associations with Chancellor Olaf Scholz (SPD) at the Munich Trade Fair on February 10. Despite the current crises, Germany again needs a more long-term strategy in order to remain successful worldwide.

“Energy costs are still high. But we also have to contend with a regulatory frenzy that ensures we often describe more paper than actually move forward,” Russwurm emphasized. At the same time, he said, Germany has the highest taxes in a global comparison, which “really hurts” the global competitiveness of industry.

Criticism: Too much bureaucracy, too few prospects
Referring to the crisis policy of the German government, Russwurm said that “together we have managed quite well.” In the long term, however, this is not enough; a “strategy of long lines” is needed. These include a secure energy supply, a reduction in bureaucracy and a noticeable reduction in taxes.

The President of the Confederation of German Employers’ Associations, Rainer Dulger, also described the economic situation in Germany as “difficult”. Like Russwurm, he called for rapid de-bureaucratization and lower energy prices. Moreover, any increases in social security contributions would send the “wrong signal.”

DIHK President Peter Adrian said that the German government’s crisis policy had worked, but that everything must continue to be done to ensure the international competitiveness of the German economy.

The German Confederation of Skilled Crafts (ZDH) complained about the existing documentation requirements and other regulations. These would hinder the work of the skilled trades and make it more expensive, said Jörg Dittrich, president of the skilled trades, to Bayerischer Rundfunk radio.

Joint declaration with demands
The Chancellor’s traditional top-level meeting with the four leading associations of German industry takes place every year at the Munich Trade Fair. In line with the demands, the business associations presented a joint statement summarizing the situation and their demands.

What is needed “beyond the pure crisis mode” is a perspective for companies “that gives them courage,” the statement says. Among other things, he said, the tax burden on corporations must be reduced from around 30 percent to an internationally competitive level of 25 percent.

Planning and approval procedures must be accelerated: “Where processes take years or even decades, the targeted halving of procedures is not enough. The goal must be to shorten them to a few months,” the statement continues. Furthermore, more flexible working time models towards maximum weekly working hours, modern rest time regulations and significantly faster procedures for the immigration of workers are needed.

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