Instead of a new economic stimulus program
FDP calls for “offensive plan for Germany”
08/07/2023 02:26 am
Germany’s economic output could fall for the first time this year. The Union wants a new economic stimulus package, but has received criticism from traffic lights and the economy. Instead, the FDP wants a strategic concept.
FDP General Secretary Bijan Djir-Sarai has rejected the Union’s calls for an emergency program to counteract the economic downturn. “What is needed now is not short-term economic stimulus programs, but a strategic concept that includes reducing bureaucracy, low taxes and an increase in private investment,” he told the Funke media group. An offensive plan is needed for Germany’s competitiveness. “We need more incentives for private investment, more innovation and less state interventionism in the form of subsidies or transfer payments.”
The President of the German Institute for Economic Research (DIW), Marcel Fratzscher, spoke out against a new economic stimulus program with subsidies and tax cuts. “An economic stimulus program that merely gives the powerful corporate lobby billions more would be counterproductive, would lead to deadweight gains and do nothing to change the economic problems.” Germany does not have an economic but a structural problem. “The federal government should therefore not launch an economic stimulus program, but a long-term transformation program with an investment offensive, broad-based debureaucratization and a strengthening of the social systems.”
Green Party leader Ricarda Lang promised early steps against the economic downturn at the weekend. She again spoke out in favor of an “investment agenda” with investments in railways, daycare centers and digitization as well as incentives for international companies to settle or expand their locations in Germany. The German economy is in the doldrums.
The International Monetary Fund expects Germany to be the only economy among the more than 20 countries and regions examined in which economic output will fall slightly this year. Federal Finance Minister Christian Lindner (FDP) has already proposed almost 50 tax policy measures intended to relieve the economy, the so-called Growth Opportunities Act.