Germany, the government aims for comprehensive modernization of the country

2025-10-02 08:34:00, Kosova & Bota CNA

Weak economic data, low poll numbers, pessimistic sentiment: The conservative-social democratic coalition government will drive a new wave of development.

Companies going bankrupt, people moving abroad, huge deficits in the social security sector, a dissatisfied population: Only 22 percent of respondents in the latest ARD poll for Germany at the beginning of September expressed satisfaction with the work of the government made up of the Christian Democratic Union/Christian Social Union (CDU/CSU) and the Social Democrats (SPD).

Chancellor Friedrich Merz (CDU) is understandably under pressure from such poll results - and that is why he invited the government cabinet to consultations at the Villa Borsig residence in Berlin. The consultations ended on Wednesday (01.10.2025). "The modernization of the state that should have been carried out on time must now advance quickly," Merz said during the government consultations. "We must verify state performance and we must become more efficient and less complicated."

Fast pace is needed, Merz believes: "Companies are partly with their shoulders against the wall or with one foot in the abyss." The German economy must grow again, Germany as an economic area must "become attractive for investment again."

Goal: Establish a business in one day

The focus of the "Modernization Agenda" is on reducing bureaucracy, streamlining the administration, strengthening digitalization and using artificial intelligence in the administration. Fax machines are still found in German offices, standing there as a symbol of the stagnation of reforms. The country has been a "node" for many years, as the Minister for State Modernization and Digitalization, Karsten Wildberger, put it.

16 billion euros should be saved by the end of the legislative period in 2029 by reducing bureaucracy, and the federation's staff should be reduced by around 8 percent.

There are around 80 separate measures. Examples: In the future, vehicles can be registered throughout Germany via a unified portal; currently there are 400 separate portals for the states and municipalities. Starting a business should be possible within one day – also via a central portal.

A digital agency "Work-and-stay-Agentur" will be created to recruit qualified foreign workers, through which visa or recognition of professional diplomas issues will be resolved in a centralized manner.

Addressing the European Union, Merz said after government consultations: "There are really too many," too many regulations, coming from Brussels.

The government consultation now taking place in Berlin is one of the latest measures by the government to give impetus to much-needed reforms in the country by harmonizing positions on many controversial topics within the coalition. Chancellor Merz emphasized that we have achieved this goal by creating "a very, very good, very collegial and open working atmosphere in this coalition." The coming weeks will show whether he is right.

Social security reform later

The really big challenges for the coalition are still ahead, such as reforming social security. Health, care and pension insurance companies are running out of money. Raising contributions for insured people would further burden entrepreneurs and further weaken Germany's competitiveness.

The state has indeed taken on new debts, but this money will not be spent on consumption, but will be used to strengthen the Bundeswehr and modernize the infrastructure. Therefore, the coalition sees savings in the social assistance sector as a way out. For reform in this sector, the relevant committees will initially compile proposals, before the government cabinet decides.

Merz initially declared an "autumn of reforms." But after it became clear that reforms could not be implemented in one season, he told the Bundestag: "Winter will come, spring, summer, and then another autumn of reforms will follow."

The government hopes that the negative mood in Germany can change for the better. According to participants in the government consultations, Vice Chancellor Lars Klingbeil (SPD) said that a cultural shift in the country is needed to create an optimistic atmosphere for a surge in development.

On the occasion of October 3, the day of German reunification, the Chancellor will give a speech, perhaps in his speech he will put the emphasis on a new impetus in the country./ DW