Over the past 16 years, Chancellor Angela Merkel has navigated Germany through several challenges, but has also failed to tackle some of the deep structural problems in largest economy of Europe.
German economists agree to the opinions that Germany has invested too little in digitisation. They also assert that the administration had neglected public infrastructure of the country despite the golden years of uninterrupted growth and budget surpluses.
In order to avoid falling further behind over the coming few years, the next coalition government of Germany must tackle three challenges of digitisation, chip shortages and ageing of its society.
Under Merkel’s administration, Germany has fallen further behind in terms of digitisation, according to the findings of a survey published in September, by European Center for Digital Competitiveness. Germany was ranked 18, out of the 20 emerging industrialized countries. Germany was followed by Japan and India at 19th and 20th positions.
Supply chain disruptions have affected the country’s business model in the field of automobiles. Automakers and other supplies largely rely on a few and exclusive manufacturers in Asia and the United States. The worldwide web of supply chains is now proving to be critically weak in Germany
The third challenge that the country would face is the ageing society, as the birth rates in Germany is relatively lower. The society is rapidly ageing and the workforce is shrinking. The uneven migration has also made the problem worse.
Merkel has largely hesitated to take necessary steps to reform the public pension system and make immigration rules more flexible. Experts say that higher immigration with more flexible immigration rules, better childcare services and more flexible working time models can ease the problems faced by Germany to a great extent.
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