Overview
- The Federation of German Industries (BDI), which called Sunday for a reform package before summer, warned that the window to lift growth is short.
- Leading economic institutes cut their 2026 GDP forecast to 0.6% from 1.3% after the Iran war began in late February and pushed up oil and gas prices.
- BDI’s agenda seeks lower labor costs through social-insurance changes, higher participation by older people and women, more training, more flexible hiring, a retirement age linked to life expectancy, and a corporate tax cut starting in 2026.
- The group tied its earlier backing for a 500‑billion‑euro special fund (Sondervermögen) for infrastructure and climate projects to broad structural reforms and said public money will fizzle without stronger private investment.
- BDI says it sees fresh willingness in the government to craft a package, yet weak approval ratings and unresolved questions on how to pay for tax relief suggest a hard path that likely needs cross-party cooperation.