The economist and personal adviser to Finance Minister Lars Klingbeil, Jens Südekum, says the reform agenda that was unveiled this week is expected to more than double Germany’s potential economic growth. “A doubling of potential growth is absolutely realistic” Südekum told the ntv website.
Germany’s current growth is largely hampered by a shrinking working population. The new reform agenda is designed to reverse that trend by boosting the number of people in employment, extending working hours, and increasing productivity through new technologies and investment in the capital stock-Südekum, who helped draft the proposals, explained. “These changes will generate growth and thereby ensure that special funds and public debt remain sustainable”.
Klingbeil’s agenda goes beyond the reform plans of the former “traffic‑light” coalition, whose impact on potential growth experts had estimated at up to 0.9 percent. From Südekum’s perspective, doubling growth-from roughly 0.5 percent to 1.0 percent in this legislative period-is already a fairly conservative forecast.
