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Advisors to Katherina Reiche demand deregulation and higher retirement age

October 07, 2025
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An advisory council to Economy Minister Katherina Reiche warns of a structural crisis in Germany and urges fundamental reforms. Without changes, deindustrialization and loss of competitiveness loom. The economists propose deregulation and raising the retirement age.

Advisors to Economy Minister Katherina Reiche (CDU) see Germany in a severe structural crisis. In a paper from the economists' circle, they warn of creeping deindustrialization, rising distribution conflicts, and loss of international competitiveness. Economic performance has stagnated for years, while other economies grow more dynamically.

The scientists cite low productivity growth, structural demographic problems, investment weakness, and excessive regulation as main causes. They specifically demand easing regulations from data protection to building law, as well as reforming social systems, including raising the retirement entry age. Denmark serves as a positive example, where people are to retire at 70 in 2040.

The advisory council emphasizes not halting structural change but enabling a 'growth-oriented structural change.' Economist Veronika Grimm stated: 'It is about becoming a technology leader in important sectors.' She mentioned bio- and medical technology, as well as nuclear technology, as examples.

Minister Reiche convened the council in late summer. Members include, besides Grimm, economist Justus Haucap from the Düsseldorf Institute for Competition Economics at Heinrich Heine University, Stefan Kolev from the Berlin-based Ludwig Erhard Forum for Economy and Society, and former economic advisor Volker Wieland.

Germany is in a long phase of growth weakness. Business associations point to high energy costs, taxes, rising social contributions, and too much bureaucracy as issues. In eastern German states, the economy still lags behind the west 35 years after reunification.

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