“Come to us”
Scholz drums for Germany as a business location
01/18/2023, 7:18 p.m
Doubts about Germany as a business location are growing internationally – especially when it comes to energy issues. In Davos, Chancellor Scholz advocates investments. At the same time he promotes more free trade and warns of a new US protectionism.
In view of the doubts about Germany’s economic model, Chancellor Olaf Scholz made a demonstrative call for investment at the World Economic Forum in Davos. “If you ask me today where you can invest sustainably and with high returns in the future, my answer is: Don’t look any further! Come and join us in Germany and Europe!” he said. Contrary to what was predicted, Germany has coped well with the energy crisis and will be one of the first climate-neutral industrialized countries in the world in 2045. Scholz also referred to a growing population – the forecasts would not have been correct here either. He specifically campaigned for immigrants: “Anyone who wants to lend a hand is welcome, that’s the message.”
The background is the doubts as to whether the high energy prices mean the end for German industry. Scholz vehemently disagreed. Even before the energy crisis, the German economic model was not based solely on the energy-intensive mass production of aluminum, cement or crude steel, but on research and technology-intensive, highly specialized industrial products that were needed worldwide.
“Even before Russia’s war of aggression, Germany’s energy prices were among the highest in the world. And yet Germany was and is competitive,” said the Chancellor. This is due to “thousands of small and medium-sized companies across the country that are highly innovative and adaptable – and that’s why they are often world market leaders”.
“Things have been different so far”
The German economy grew more than expected in the last quarter of 2022, which is why Scholz emphasized on Tuesday that a recession had been averted. Scholz had already pointed out at the end of December that one had to say goodbye to the idea that Germany’s population was shrinking. “Things have been different so far. Today, Germany has more residents and more workers than ever before. And it is precisely this development that we will continue,” he said. A few weeks ago he spoke of a “plausible” development of up to 90 million inhabitants in 2070.
The economy is complaining about a rampant shortage of skilled workers. The traffic light government therefore wants to make labor immigration much easier.
Scholz rejects new EU investment pot
Scholz also campaigned for free trade. He will do his utmost to ensure that the EU concludes agreements with India, the South American Mercosur countries and Indonesia, he said. In order to achieve fairness in the competition between the countries with different climate protection efforts, the EU must have a border adjustment mechanism, emphasizes Scholz. This could then have import duties for products from countries without expensive climate protection regulations.
Scholz emphasized again that he welcomes the US subsidies for climate-friendly investments. However, these should not put European industry at a disadvantage. “Protectionism prevents competition and innovation and harms climate protection,” he warned. At the same time, Europeans would have to expand their subsidies for key technologies, especially in the digital and climate sectors.
Scholz expressly contradicted demands for a new EU pot for investments worth billions. “The funds are available: only 20 percent of the more than 700 billion euros in the European recovery fund have been paid out,” he warned. EU state aid law must become more flexible.