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Germany Needs to Implement Structural Changes to Prevent Political Shift, Says Commerzbank CEO
During the Handelsblatt Banking Summit 2023, Commerzbank CEO Manfred Knof expressed the need for Germany to implement structural changes in order to avoid a political shift to the right. Knof emphasized that the population is dissatisfied and aware that the country’s structural problems remain unresolved.
Knof admitted that Germany had been complacent and slow to modernize and address necessary structural changes. He stated, “For a long time we were pretty much in good shape and maybe asleep and not ready to modernize and tackle the structural necessary changes and modernizations.”
An Agenda for Change to Bring the Population Back, Defend Democracy
Knof suggested that an agenda for change could help in bringing the population back and defending democracy. He acknowledged that democracy cannot be taken for granted and that it requires constant effort and dedication.
As of now, the Federal Ministry for Economic Affairs and Climate Action in Germany has not responded to AsumeTech’s request for comment.
The rise of right-wing parties in Germany has become a concern for the economy. In June, the right-leaning Alternative for Germany party won a district council election for the first time, leading many to watch their performance in upcoming local elections in Bavaria.
Knof also highlighted the reluctance of Germany’s small-to-medium-sized companies, known as the Mittelstand, to invest in their own country due to the prevailing structural issues in Europe’s largest economy.
Challenges Ahead for German SMEs in Investing
Addressing the challenges ahead, Knof noted that German SMEs are resilient but exhibit a lack of willingness to invest. He emphasized the need for more activities and a better framework to encourage investment within the country.
The concerns raised by Knof align with statements made by Siegfried Russwurm, head of the German Industry Federation, who highlighted energy prices as a driving factor for companies considering relocation.
Population Leaning Right and Concerns Over Energy Strategy
Hans-Werner Sinn, president emeritus at the Ifo institute, also expressed similar views regarding the German population’s political shift to the right. He specifically criticized the government’s approach to sustainability.
Germany is currently working to implement its Energy Efficiency Strategy 2050, aiming to reduce its primary energy use by 2030. However, the strategy has faced criticism due to the sharp increase in energy prices caused by Russia’s full-scale invasion of Ukraine.
