According to German finance minister Wolfgang Schaeuble, who himself is under pressure to increase infrastructure spending; Germany must invest in order to remain competitive on the global markets.
A weakening in the German economy, widely considered the most important economy in Europe, has seen concern spread throughout the region and, naturally, the German government are keen to rectify the problem rapidly. Potential infrastructure projects could include roads, railways, and energy and broadband networks.
Although an improvement in spending is needed, Mr Schaeuble said that he was not prepared to sacrifice a balanced budget to achieve this and is still on target to balance the books by the end of the year, a feat that hasn’t been achieved since 1969. He went on to say:
“We must invest more and improve our competitiveness. We must get to work on this – quickly and in a concrete way.”
This need for investment could see the German government turning to foreign investors, as well as providing some spending money of their own, and employing schemes and initiatives to make Germany a far more attractive investment prospect and to encourage outside money into the country.
Germany remains Europe’s largest economy and is still expected to grow by 1.2% by the end of this year and 1.3% by the following year so it is by no means in threat of a recession again but a slowing economy is something that is cause for concern hence the need for rapid investment before the issue becomes greater than it need be.
There has been weak industrial output and a fall in business confidence as of late which has seen the Germany economy maintain the rapid growth it had at the start of the year as growth has been revised down from the 2% it was supposed to hit but if investment can be found the country could well be on its way to a sustained period of growth.
A leading light in the European Union, Germany has considerable trade links with the rest of Europe and is seen as a hub of political and industrial output for the bloc which, as a whole, has managed to drag itself out of recession and is working its way back towards being a booming economic force once more and with trade deals with India, China and the US all having happened or being on the cards, this looks increasingly likely.
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