VCI position in a nutshell
Economic Recovery and Growth Programmes for Germany and Europe
The German economy remains dominated by the corona pandemic and the global economic crisis which it triggered. Meanwhile, the crisis has bottomed out.
With the easing of restrictions, a recovery set in after the historic slump in economic output. However, this recovery is on shaky ground: As the pandemic is regaining momentum in some countries, the less stringent protection measures are repealed by numerous states.
Politicians responded quickly and appropriately to the crisis and supported businesses in Germany in a strong and unbureaucratic manner. Extended short-time work, liquidity protection and fast access to credit were important forms of aid. But the recent extension of the emergency programme is critical, because it is costly and economically inefficient companies are kept alive artificially.
The German government has decided to provide further support in its economic stimulus package. 130 billion euros are intended to invigorate consumption and investment. Digitalisation, infrastructures and research will be promoted too. However, not all parts of the programme have been implemented yet. Regarding some points, the EU is examining whether they are compatible with European competition law. Greater speed is needed here.
A genuine Future Programme is needed
The proposals in the economic stimulus package to strengthen sustainable growth are far from sufficient for stimulating innovation in the long term and modernising the industrial base. Moreover, further industrial policy measures are necessary so that Germany and Europe come out stronger from the crisis.
The economic stimulus package should be followed by a Future Programme that gives tailwind to sustainable growth and eliminates growth obstacles. Germany must become attractive for industrial investment – as regards tax and innovation policies and regulation.
National programmes should be closely attuned to the Recovery Plan launched by the EU in July.
THE VCI IS CALLING FOR THE FOLLOWING
- Rapid implementation of the economic stimulus programme and improved corona resilience
For the economic recovery to become a steady process, all measures of the economic stimulus programme must be implemented rapidly. Furthermore, the prerequisites should be created for avoiding another lockdown. Emergency aid schemes should be clearly limited in time.
- Get the Future Programme started
The Future Programme that increases the attractiveness of the industry location Germany and supports the digital and sustainable transformation of the economy should become a central component of the next German government coalition agreement and include the following: company tax reduction to 25 percent, substantial lowering of energy costs particularly for renewable energies, moratorium on bureaucratic and financial burdens, faster planning and approval procedures as well as a comprehensive investment programme for climate protection, circular economy and digital infrastructure.
- Use the EU Recovery Plan for comprehensive industrial policy reform
The EU provides substantial funding for investments in infrastructure expansion, the energy transition and sustainable restructuring of the economy in Europe. Such programmes need to be developed and launched without delay and in close consultation with industry, and they should be geared to economic recovery, growth and transformation.
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