Germany’s businesses want Berlin to walk their talk

The new Government of Germany has been in power for just over 100 days, and business leaders say it is time to convert policy promises actually.

Chancellor Friedrich Merz campaigned on a pro-negocium and pro-economic growth platform, promising reforms and investments that caused hope in the business community. Optimism was further promoted when the coalition negotiations between the Christian Democratic Union of Merz, together with its brother party, the Christian Social Union and the Social Democratic Party, triggered an important fiscal change that is established to allow a greater expense in defense and infrastructure.

The CDU, CSU and SPD now form the German coalition government, and the feeling of enthusiasm on the part of the companies has persisted as the political term of the coalition has been launched, according to the business leaders who have spoken with CNBC in recent weeks.

“We have, as he heard before, a minimum of 10, perhaps 20, years of weak political decisions, very ideologically driven, not driven by business, not driven by society, and it seems that the new government is in a different direction,” Thomas Schulz, CEO of the construction company BilfingerHe said earlier this month.

In other places, the CEO of the Allianz financial services provider, Oliver Bäte, welcomed the new government’s approach to take competitiveness seriously, and Merz repeatedly committed himself to the German industry to return to normal to boost global leadership.

“I can only applaud them to take it seriously, also mobilize financial reservations to establish an unprecedented investment program, and also finish almost two decades of under investment lethargy in infrastructure, under investment in military, defense [and] under investment in education, “he said.

The leading German companies in July announced their own initiative, with the aim of promoting the interest and confidence of investors. The group composed of 61 companies plan to collectively invest 631 billion euros [$737.4 billion] by 2028.

“This is a good sign, and shows that there is an alliance between [the] The corporate world and politics these days, which is very important, which has not been the case in recent years, “the Deutsche Telekom CEO, the Deutsche Telekom CEO, told CNBC.

The tone achieved by business leaders is also reflected in recent data, with the IFO Economic Institute that informs improvements in the company’s feeling for five consecutive months.

However, companies are also calling the government to action, demanding that campaign promises become a reality.

Bäte de Allianz told CNBC that, although the government’s attitude was good news, “now the delivery comes,” and Schulz de Bilfinger said that “there is only one lipstick in many areas, with very good ideas, but we have to reach the execution.”

The economists surveyed on the IFO policy and the Frankfurter Allgemeine Zeitung German news organization also noticed the lack of measures that have been implemented so far during the Merz mandate.

“30% of participating economists qualify the economic policy measures of the new German government in the first 100 days as” quite negative “, with additional 12%, even qualifying them as” very negative, “” found the survey.

The participants highlighted “the lack of reform efforts in the area of ​​social security systems. In addition, they see a lack of a clear stimulus for more structural reforms, the reduction of bureaucracy and progress in climatic protection,” he said.

Business leaders had an extensive desire list to share with CNBC.

Roland Busch, CEO of Tech conglomerate SiemensHe was one of those who requested structural reforms. Some of which included “digitalization, faster decision processes, less bureaucracy, work [on] Our energy transformation “and changes in the labor market.

The leaders also called the specific needs of the business, with Höttges of Deutsche Telekom saying that the company could receive support by local authorities and the federal government in its construction of fiber infrastructure.

Many of these issues were also marked by leaders as reasons for the economic weakness of recent years. Germany’s economy contracted both in 2023 and 2024. The largest economy in Europe registered a gross internal product growth of 0.3% in the first quarter followed by a contraction of 0.1% in the following period, according to data, in the second quarter.

“In Germany, we have not been growing as a country in the last two years, and there are reasons behind that. It is about bureaucracy, it is education, it is security, energy prices prices and, in that context, be competitive on a global scale,” said Carsten Knobel, CEO of the chemical business and Henkel consumer goods.

“But we need to turn this country from a country not growing to growth,” he said.