According to the VDMA, the industrial locations of Germany and Europe urgently need a fresh cell culture in order to noticeably boost competitiveness. In its "Economic Policy Positions 2024", the German Engineering Federation calls on politicians to implement reforms that will strengthen economic power and industry. VDMA President Karl Haeusgen: "These tasks are very specific: Reduce bureaucracy, reform the tax system, make the labour market more flexible, expand the infrastructure and enable more free trade again." These measures are necessary to secure the industrial base and thus also prosperity in Germany and Europe - especially in a year in which elections are being held in Europe. "We want to work together with politicians to find solutions that do justice to the interests of all parties involved. This is the only way the European and German economy can continue to build on its strengths and overcome its weaknesses," emphasizes Haeusgen.

Labor market reform called for

In its "Economic Policy Positions 2024", the association lists a total of twelve fields of action that are of crucial importance for securing locations. As the largest industrial employer, the mechanical and plant engineering sector sees a particular need for reform in the labor market. The more difficult it becomes for companies to find the skilled workers they need, the more important flexible employment opportunities and easier recruitment of foreign skilled workers become for them(in this context, please also read the VDMA cooperation with getINNOtized). Extended weekly and lifetime working hours with flexible transitions into retirement should also not be taboo. "In future, blanket statutory regulations will be even less able to provide the right answers to new challenges. More operational and individual leeway is needed," the paper states.

Using technological solutions to combat climate change

The VDMA describes climate change as the greatest challenge facing mankind. Stopping it will only be possible with modern technology, which is currently being developed and brought to market by the mechanical and plant engineering industry. "Global_{CO2 pricing} is and remains the most efficient instrument for achieving climate targets," writes the VDMA. However, many technological measures are needed on the path to climate neutrality, in particular to increase the energy efficiency of products and processes. Technological openness instead of predetermining certain technologies must be the guiding principle. Only if companies have enough freedom to innovate will it be possible to achieve the desired climate-neutral production on a broad basis in time, according to the association. This would also require a rethink of regulatory policy: Instead of overwhelming SMEs with more and more laws and bureaucratic requirements, politicians in Europe should ensure "reliable harmonized regulations with strong market surveillance", according to the VDMA.

Open markets necessary

For a strongly export-oriented industry - four out of five domestically manufactured machines are sold across borders - open markets also play a key role in economic success. In view of increasing protectionism in many parts of the world, it is all the more urgent that free trade agreements that have already been negotiated - such as Mercosur - are ratified promptly and that new agreements are also concluded. India in particular is mentioned with regard to new agreements. However, the VDMA warns that free trade agreements must not be overloaded with environmental and social policy objectives. A reform of export financing, which should focus more on "small tickets" for SMEs, is also required. "Politics and society must constantly defend the benefits of free trade and globalization and counter the threats posed by increasing protectionism and politically motivated restrictions worldwide," it says.

"Our times are characterized by climate change, geopolitical upheavals and wars. Many economic policy measures therefore follow the imperative of acute urgency rather than sustainability. The fact that Europe and Germany have so far been able to respond with such financial strength is largely due to the fact that we have an industrial base, which is the foundation for our prosperity and therefore also for state scope for action," summarizes Haeusgen. "To ensure that this remains the case in the future, we must now step up our efforts to increase our competitiveness and improve our location conditions. Prioritization and efficiency are the order of the day!"

You can download the "Economic Policy Positions 2024" here: