Finance
Germany must pivot toward new 'growth engines', economy minister says
Published by Global Banking and Finance Review
Posted on January 30, 2026
2 min readLast updated: January 30, 2026
Quick Summary
Germany's economy minister emphasizes the need for new growth engines like digitalization and AI, as traditional exports falter. The government plans investment and reforms to boost growth.
Germany must pivot toward new 'growth engines', economy minister
Germany's Economic Strategy for Future Growth
By Maria Martinez
Current Economic Challenges
BERLIN, Jan 30 (Reuters) - Germany's Economy Minister Katherina Reiche said on Friday the country must pivot toward new "growth engines", arguing that traditional export strengths "no longer carry our growth" as they once did.
Investment and Reform Initiatives
"The sources of global growth today lie in areas like digitalization and artificial intelligence; in new energy technologies, biotechnology, advanced materials, and the defence industry," Reiche told Germany's lower house of parliament.
Europe's biggest economy lowered its growth forecasts for this and next year on Wednesday, citing heightened uncertainty around global trade and the fact that economic and fiscal-policy measures had not taken effect as quickly as previously assumed.
The government trimmed its growth forecast for 2026 to 1.0% from 1.3%, confirming a report from Reuters last week. GDP growth in 2027 is now seen at 1.3%, down from 1.4% expected previously.
"The central question is: how do we secure prosperity, competitiveness and social peace in this new situation?" Reiche said, referring to a fragmented world economy.
Reiche said the government is pursuing a two-track approach: an investment push in infrastructure, climate protection and defence, alongside reforms designed to attract private capital.
Public investment makes up only 16% of total investment, the minister said. "We must achieve more private investment."
(Reporting by Maria Martinez, Editing by Friederike Heine)
Key Takeaways
- •Germany needs to find new growth engines beyond traditional exports.
- •Focus areas include digitalization, AI, and new energy technologies.
- •The government is lowering growth forecasts due to global uncertainties.
- •A two-track approach with public investment and private capital is planned.
- •Public investment currently constitutes only 16% of total investment.
Frequently Asked Questions about Germany must pivot toward new 'growth engines', economy minister says
1What is GDP?
Gross Domestic Product (GDP) is the total monetary value of all goods and services produced in a country over a specific time period, used as a measure of economic performance.
2What is economic growth?
Economic growth refers to an increase in the production of goods and services in an economy over a period of time, typically measured as the percentage increase in GDP.
3What is investment?
Investment involves allocating resources, usually money, to generate income or profit. It can include purchasing assets like stocks, bonds, or real estate.
4What is innovation?
Innovation is the process of creating new ideas, products, or methods that improve efficiency or effectiveness, often driving economic growth and competitiveness.
5What is sustainability in economics?
Sustainability in economics refers to practices that meet current needs without compromising the ability of future generations to meet their own needs, often focusing on environmental and social responsibility.
