Industrial Policy

Arguments and Positions

Industry is the basis for Germany’s economic strength. With its products and innovations, the chemical-pharmaceutical industry contributes decisively to solving societal and climate policy problems.

Companies are operating in a rapidly changing environment. International competitive pressure is increasing, and the industrial and trade policies of China and the USA are transforming the international economic order as a whole.

A radical change is taking place generally: New processes alter the economy and thus not only production methods but society overall. The areas affected by such dynamics range from biotechnology and digitalisation to new drive technologies and the development of a circular lifestyle.

At the same time, the challenges of climate and environmental protection are growing: greenhouse gas neutrality, circular economy and preserving biodiversity are important dimensions in the relevant change processes. It is deplorable that they still have just a minor role in the „National Industry Strategy 2030“ as presented in late November 2019 by the German minister for economic affairs Peter Altmaier.

Altmaier*s Industry Strategy 2030

Altmaier’s Industry Strategy strongly focuses on improving locational conditions and technology promotion. The strategy comprises measures for better framework conditions and correctly identifies many topics to make Germany fit for the future: internationally competitive taxation and energy prices, innovations, investments in transport and digital infrastructures, bureaucracy reduction, the digitalisation of industry and maintaining the rules-based trade system. Greatly important topics to the chemical industry – such as biotechnology, circular economy and carbon leakage protection (measures to prevent shifts of emissions to other countries) – are included too.

Furthermore, the strategy quite rightly takes into account the European dimension, as the single market needs to be further developed and certain aspects of technology promotion and competition and trade policies can be tackled only within the EU framework. A particular strength of the location Germany is the innovative „Mittelstand“, i.e. mid-sized enterprises. Consequently, the industrial policy is accompanied by a „Mittelstandsstrategie“.

Implementation of the strategy is still unclear

Peter Altmaier has presented his strategy as a proposal by his ministry. However, the strategy also takes up topics from other departments. This makes it even more important for the proposals to lead to a cross-departmental overall strategy of the federal government and concrete political steps. Unfortunately, this seems unlikely at present.

THE VCI IS CALLING FOR THE FOLLOWING

  • Fast and cross-departmental implementation of the Industry Strategy
    The course in the industrial policy needs to be reset urgently. The whole federal government should give its backing to Altmaier’s Industry Strategy. It is not sufficient to hold one industrial policy conference after another. The grand coalition should jointly create the framework conditions in industrial policy, in order to support the transformation of industry and to translate it into concrete politics.
  • Scope, resources and openness for innovations
    For more innovations for sustainable products and processes, there should be research promotion with an open mind to a wide range of technologies, well-funded project support, and easier access to venture capital. Also needed is a science-based societal dialogue on the potentials and risks of new technologies.
  • Interlinking with the European industry strategy
    Close interlinking with the forthcoming EU industry strategy is urgently needed – also taking into account the European „Green Deal“. It is important for the EU industrial policy to strengthen competition in the single market and to focus on innovation – instead of trying to steer the economy by way of dirigiste inter¬ventions. In the described setting, the EU’s global environment must be given consideration from an early stage.

For questions or suggestions, please feel free to contact us.

Contacts

Henrik Meincke

E-Mail: meincke@vci.de