"Overcoming Weak Growth – Investing in the Future". Highlights from the 2023-24 Annual Report of the German Council of Economic Experts

Although the German economy has come through the COVID-10 crisis well, it has been experiencing weak growth since the start of the energy crisis two years ago. In the short term, the energy crisis and the high level of uncertainty are likely to continue to weigh on the economy. In the medium term, demographic ageing is the most significant obstacle to growth and is likely to push structural growth in Germany to an all-time low. Based on the analysis of these developments, the German Council of Economic Experts discusses various ways in which Germany can overcome this weak growth and invest in the future in its current annual report. One focus is on strengthening capital market financing in Germany and Europe, which is particularly relevant for risky but especially growth-boosting investments. In addition, the second focus is on reforms to statutory pension insurance that can reduce the demographic-related increase in the funding requirements of the statutory pension scheme. These reforms can also help to increase labour force participation in old age. A third focus is on the increased risk of poverty and reforms to the basic security system to reduce the risk of poverty while improving incentives to work.