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Cutting red tape key to restoring confidence of German companies, survey shows
Published by Global Banking & Finance Review®
Posted on June 13, 2025
2 min readLast updated: January 23, 2026
Quick Summary
A survey shows that cutting bureaucracy is crucial for boosting German business confidence, with 97% of companies agreeing. Economic policies and export prospects also play significant roles.
Reducing Bureaucracy Essential for Boosting German Business Confidence
By Maria Martinez
BERLIN (Reuters) -Cutting bureaucracy would give German companies more confidence in economically uncertain times, according to a survey from the German Economic Institute IW seen by Reuters on Friday.
Of the more than 2,000 companies surveyed, 97% said reducing bureaucracy would increase their confidence, while 75% said it would have a "strong influence" and 22% a "moderate influence" on their confidence.
Germany is the only G7 nation that has recorded no economic growth for two consecutive years and business morale has therefore been depressed, according to indicators such as the Ifo business climate index.
For two-thirds of companies, a moderate increase of labour costs would have a strong positive effect on their outlook, with an further 31% seeing a moderate effect.
Almost all companies stated that economic policy had a strong or moderate influence on their confidence, with 89% of the companies favouring efforts for competitive energy prices and 92% favouring investment-oriented tax policies.
Nearly half of companies in the survey cite improved export prospects to Asia and the United States as a potential confidence boost. Better export prospects within Europe were considered even more important.
(Reporting by Maria Martinez and Rene Wagner, Editing by Friederike Heine)
Key Takeaways
- •97% of German companies believe reducing bureaucracy boosts confidence.
- •Germany has seen no economic growth for two consecutive years.
- •Competitive energy prices and tax policies are favored by companies.
- •Improved export prospects to Asia and the US boost confidence.
- •Better export prospects within Europe are even more important.
Frequently Asked Questions about Cutting red tape key to restoring confidence of German companies, survey shows
1What percentage of companies believe reducing bureaucracy would boost confidence?
According to the survey, 97% of the more than 2,000 companies surveyed stated that reducing bureaucracy would increase their confidence.
2How has Germany's economic growth compared to other G7 nations?
Germany is the only G7 nation that has recorded no economic growth for two consecutive years, leading to depressed business morale.
3What do companies think about the influence of economic policy?
Almost all companies in the survey indicated that economic policy had a strong or moderate influence on their confidence, with 89% favoring efforts for competitive energy prices.
4What impact would a moderate increase in labour costs have?
For two-thirds of companies, a moderate increase in labour costs would have a strong positive effect on their outlook, while 31% see it having a moderate effect.
5Which regions are companies looking to for improved export prospects?
Nearly half of the companies cited improved export prospects to Asia and the United States as a potential confidence boost, with better prospects within Europe being even more significant.