Overview
- Clemens Fuest told Süddeutsche Zeitung that current policy under Chancellor Friedrich Merz is indecisive and leans on temporary financial fixes instead of structural reforms.
- Fuest forecast that taxes and levies are likely to rise to meet obligations such as pensions, a move he said would curb investment and accelerate capital outflows.
- He argued Germany’s weakness is largely homegrown, noting the global economy is expanding while Germany fails to participate despite acknowledging external shocks like gas shortages, geopolitical uncertainty and U.S. tariffs under President Donald Trump.
- Official Destatis data show Germany’s GDP fell 0.2% in 2024, the second consecutive annual decline, providing context for Fuest’s warning.
- In a separate interview, employers’ association chief Rainer Dulger called the situation Germany’s longest crisis since the republic’s founding and urged deep reforms, directly appealing to Merz to act.