BDI Downgrades Germany’s 2025 Growth Forecast to -0.3 Percent
(MENAFN) On Monday, the Federation of German Industries (BDI) downgraded its economic growth outlook for Germany in 2025, predicting a contraction of 0.3%, a drop from the previous estimate of a 0.1% decline. This adjustment comes in response to the escalating US tariffs impacting German exports.
The BDI highlighted that "Industrial production remains significantly below the pre-crisis level of 2019, and capacity utilization is only 77%," underscoring ongoing struggles in the manufacturing sector.
The organization emphasized that a robust economy is crucial for enhancing national sovereignty and reinforcing overall defense capabilities.
German industry is committed to playing a pivotal role in regional security, viewing the country’s defense readiness as a collaborative responsibility shared by both government and businesses.
BDI head Peter Leibinger commented, "We still have a long way to go to get out of the recession." "Nevertheless, there is a real chance for an upturn next year if the federal government resolutely pursues the path it has chosen."
Leibinger praised the government’s initial efforts, noting, "The government has already sent important signals with its first initiatives, such as the 'investment booster' and tax and energy cost relief."
Looking forward, he stressed the necessity for additional actions, particularly structural reforms, to bolster the economy’s long-term strength and competitiveness.
Highlighting energy expenses, Leibinger called for a lasting reduction to a competitive level and pointed out the possibility of savings during the transition to sustainable energy sources.
Finally, he urged both the EU and German authorities to enact a meaningful cutback in bureaucracy with clear, measurable reduction targets.
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