The publication of the Draghi Report in September 2024 has brought the problems of European competitiveness into the spotlight. Ongoing crises, lagging behind in key technologies of the 21st century and structural challenges such as high energy costs pose significant hurdles for Europe's economy. Germany is particularly affected by this and is suffering from economic recession for the second year in a row. Mario Draghi is campaigning for more investment, but disagreement over the necessary financing instruments is currently blocking decision-making in Berlin and Brussels.
In the latest edition of Berlin Perspectives, Dr. Tobias Hofelich and Klara Stecker analyze the key economic policy challenges and formulate recommendations for action for the next German government. As it is unlikely that a uniform position on the topic will be taken at either national or European level in the short term, the authors advocate a two-stage approach: long-term priorities should be set at European level and investments strategically coordinated, while funding remains the responsibility of the member states. There is a considerable backlog in the area of research and development in particular, which should be addressed with binding EU-wide investment targets.
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