Germany has been in industrial free fall since the 2022 energy shock, with total industry, construction and production excluding energy all remaining below the 2021 baseline.
As Germany is Europeโs largest economy and the EUโs biggest import market, its industrial crisis is not only a German problem.
When German industry weakens, demand, supply chains and growth across the whole European economy weaken with it.
Berlin now needs a serious pro-growth agenda.
Germany has the fiscal space to act. Its debt ratio is still low compared with other major economies, and it can afford to use public spending to rebuild growth.