you are currently viewing:Making Germany Grow AgainJune 3, 2025--Long-term, future-focused investment can rescue Europe's largest economy from stagnation And this time, the illness is a chronic condition, requiring a long-term treatment plan. The new government's fiscal plan to fund infrastructure investment and increased defense spending is a start. But Germany must also open its economy to future-oriented technologies, push for greater market integration in Europe, and build stronger capital markets at home. For the past five years, Germany's economy has been stagnant, growing by just 0.1 percent since 2019. Source: IMF.org |
July 3, 2025-Abstract
Russia's war of aggression against Ukraine and rising trade tensions continue to slow down the European economy. Despite strong policy responses to external shocks, the near-term outlook is clouded by elevated uncertainty. Disinflation is progressing, but monetary policy should remain vigilant. Fiscal policy needs to make space for new spending needs, such as defence, but to ensure medium-term sustainability, fiscal prudence must continue.
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