German Economy Minister Katharina Reiche said that Germany is experiencing an economic downturn and is currently uncompetitive.
“We are currently uncompetitive with our structures”, Reiche said, speaking at the Foreign Trade Day in Berlin. Her words were quoted by the DPA news agency. She also noted that against the backdrop of the trade policies of the United States and China, Germany is at the center of the global tension between open markets and geopolitical interests. "How we deal with this will determine whether we can remain a real economic power," the minister stressed.
At the same time, the head of the German economy ministry noted that "German companies suffer from overregulation, high energy prices and a welfare state that is a burden on labor costs on such a large scale." She called for fundamental reforms and pointed out that they were also needed at the EU level. "The European Union must refocus on becoming a driver of strong competition and no longer be seen as a regulatory brake," she said.
At the same time, Reiche called on companies to expand their supply chains and warned against one-sided dependence on China, especially in raw materials. The growth potential in markets like Vietnam and Mexico, she said, is huge.
On October 14, the German Federal Statistical Office reported that inflation in September reached 2.4% year-on-year. This is the highest value this year. Germany has been experiencing a prolonged economic crisis in recent years. It was initially caused by the COVID-19 pandemic and then worsened after the disruption of Russian gas supplies. Earlier, members of the government's expert council on economic development revised downward their forecast for Germany's economic growth in 2025. The country could face a third consecutive year of recession.