Germany’s Economic Outlook

BERLIN (Reuters) – Structural reforms are a requirement for the German economy to grow again, German Economy Minister Katherina Reiche stated on Tuesday in the lower house of parliament.

German business associations have criticized the new government’s surge in public spending, which targets defense and infrastructure. They argue that this approach will not be sufficient to revive the economy unless it is accompanied by structural reforms to enhance competitiveness.

Europe’s largest economy has contracted for the last two years, with threats of tariffs from U.S. President Donald Trump potentially leading it towards its third consecutive year of recession, marking a first in post-war German history.