{"id":606810,"date":"2026-05-27T15:23:09","date_gmt":"2026-05-27T15:23:09","guid":{"rendered":"https:\/\/www.newsbeep.com\/uk\/606810\/"},"modified":"2026-05-27T15:23:09","modified_gmt":"2026-05-27T15:23:09","slug":"german-top-economists-urge-merz-to-enact-painful-reforms-to-revive-growth-politico","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/uk\/606810\/","title":{"rendered":"German top economists urge Merz to enact painful reforms to revive growth \u2013 POLITICO"},"content":{"rendered":"<p>\u201cWe know what negative consequences this will have,&#8221; she said, &#8220;It means less take-home pay. People will be able to consume less, have fewer incentives to work \u2014 that&#8217;s bad for the economy. Labor costs for businesses will rise \u2014 that&#8217;s bad for the economy. The pressure to act is immense.\u201d<\/p>\n<p>Germany\u2019s weak economic performance has <a href=\"https:\/\/www.politico.eu\/article\/germany-friedrich-merz-comeback-tour\/\" rel=\"nofollow noopener\" target=\"_blank\">fueled growing public frustration<\/a> with the government, driving  Merz\u2019s government to record-low approval ratings even as many of the forces driving the country&#8217;s economic malaise lie beyond the chancellor\u2019s immediate control.<\/p>\n<p>The population is aging rapidly, with the retirement of the baby boom generation sending pension and health care costs soaring. At the same time, the country\u2019s export-dependent economy is under mounting strain from persistently high energy prices linked to the U.S.-Israeli war with Iran, intensifying Chinese competition in core manufacturing sectors, and pressure from U.S. tariffs.<\/p>\n<p>The economic council cut its growth forecast for this year to 0.5 percent \u2014\u00a0<a href=\"https:\/\/www.politico.eu\/article\/german-government-slashes-economy-growth-forecasts\/\" rel=\"nofollow noopener\" target=\"_blank\">in line with the government\u2019s own forecast<\/a> \u2014 down from 0.9 percent, citing the expected economic fallout from the war in Iran. The economists also expect inflation to rise to 3.0 percent.<\/p>\n<p>\u201cTariffs and the energy crisis are hitting the German economy particularly hard, as it is a net exporter of goods and a net importer of fossil fuels,\u201d said economist Gabriel Felbermayr.<\/p>\n<p>&#8220;We all watch the events unfold with bated breath every day and have little chance of making any real predictions here. However, every day that passes with the Strait of Hormuz blocked makes the worst-case scenario [of prolonged stagnation] more likely,&#8221; Felbermayr added.<\/p>\n","protected":false},"excerpt":{"rendered":"\u201cWe know what negative consequences this will have,&#8221; she said, &#8220;It means less take-home pay. People will be&hellip;\n","protected":false},"author":2,"featured_media":606811,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[84,13931,1294,1344,2794,145,3247,4178,156,56,54,55,163220],"class_list":["post-606810","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-economic-performance","tag-economy","tag-energy","tag-friedrich-merz","tag-germany","tag-health-care","tag-pensions","tag-tariffs","tag-uk","tag-united-kingdom","tag-unitedkingdom","tag-war-in-iran"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/606810","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=606810"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/606810\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/606811"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=606810"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=606810"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=606810"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}