Why Economics Minister Habeck's policies are damaging our economic growth and France is overtaking Germany

Why Economics Minister Habeck's policies are damaging our economic growth and France is overtaking Germany

According to a report from www.focus.de, Economics Minister Robert Habeck's policy focuses on bans and delays, which in my opinion sets the wrong priorities and are therefore poison for economic growth. This was also evident at the beginning of May when the Taiwanese company ProLogium decided to move its 5.2 billion euro car battery gigafactory to France instead of Germany. This creates thousands of direct and indirect jobs in France. In addition, France has also overtaken Germany in the number of unicorns, companies with a valuation of more than one billion euros. France also has plans for 2030 to invest 30 billion euros in the creation of “high-tech champions of the future”. In contrast, Germany currently has little to counter it and is in danger of losing touch in this area.

The lack of support for innovations and startups in Germany compared to France, especially with regard to the immigration of skilled workers and the reform of the Future Financing Act, leads to unattractive conditions for the business location. Startups in Germany are already suffering from declines, while France is providing new impetus with targeted measures such as the special “French Tech Visa” for skilled workers from outside the EU. The lack of amendment to the immigration law in Germany and the slow legislative process of the planned future financing law continue to contribute to an unattractive situation for startups.

However, the planned Future Financing Act offers a ray of hope by making it easier for startups to access capital and re-regulating employee equity participation. The taxation of participation programs plays a crucial role here, and is currently regulated unfavorably in Germany. In France, on the other hand, the retention of skilled workers is supported by tax incentives for equity participation programs. This difference could lead to an increase in tech talent migrating to the more attractive environment of France.

Overall, there is a risk that Germany will lose its competitiveness on the market and in the financial sector if targeted measures are not taken soon to make the business location more attractive. The current developments in France show that Germany needs to learn from its western neighbors and promote innovations and startup culture more in order not to lose touch.