At the start of its summit in Berlin, the Mechanical Engineering Industry Association (VDMA) leveled sharp criticism at the German federal government. “We are dumbfounded by the infighting within this government, which is blocking urgent reforms,” VDMA President Bertram Kawlath stated on Tuesday. “Dumbfounded by the sugarcoating found in so many government statements. Dumbfounded by the visible decline of our nation as a business location. And dumbfounded by the reckless way in which social cohesion is being put at risk.”
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Kawlath pointed specifically to the “drags”—those within the trade unions and the governing coalition who have hindered urgently needed labor market reforms. A study conducted by the German Economic Institute (IW) for the VDMA indicates that extending the workweek by just one hour would boost real gross domestic product (GDP) by 1.5 percent over the next five years. During that same period, corporate investment would increase by nearly five percent. Furthermore, after five years, there would be approximately 120,000 more people in employment, and the unemployment rate would be 0.2 percentage points lower.
“More work does not, therefore, mean fewer jobs,” emphasized Kawlath. He urged the German federal government to “immediately implement the necessary labor market reforms, as well as the urgently needed reduction of bureaucracy.”
Regarding international trade, the VDMA president called for a “new strategic direction.” He argued that Europe and the German federal government must act more decisively, particularly in their dealings with China. “If China plays unfairly, Europe must respond appropriately,” Kawlath stated. This could require, if necessary, the imposition of countervailing duties, a reversal of the burden of proof in combating subsidies and dumping, and a system of market surveillance that truly lives up to the name.
Author: AFP – ilo/pe – Translated by Blackout News
Sources: AFP Press Portal