Germany Needs To Follow The Example Of Its Footballers

China, Europe

SHARE THIS STORY

Philipp_Lahm_lifts_the_2014_FIFA_World_Cup

By John Richardson

WHAT a fantastic World Cup and Germany were deserved winners. Their flair, dedication, organisation, attention to detail and team spirit were great to see.

But in Gideon Rachman’s very thoughtful piece in Tuesday’s Financial Times, he highlights some of the points we’ve been making over Germany and its economy over the last two years.

“Germany has lousy demographics. Its fertility rate of just over 1.3 children per woman means that the country’s population is both ageing and on a downward trajectory. Recent moves to reduce the pension age for some workers will make this problem worse,” writes Gideon.

And he adds that German industry is over-reliant on exporting to China. He points out that as China attempts to escape the middle income trap, its manufacturers will increasingly move upmarket to attack the profitable niches that German manufacturers have so far made their own.  This will be accompanied by strong government subsidies for innovative higher-value manufacturers.

Germany, and the rest of the global economy, faces the much more immediate risk that the fault lines in China’s property market threaten a new global economic crisis.

Plus, there is energy. Even Germany’s Economics Minister and Vice Chancellor has admitted that the country’s Energiewende policy is “on the verge of failure” because it has proved more complex than had been expected.

Energiewende, which involves a huge push towards renewables away from nuclear power and fossil fuels, is flawed because of the unreliability and cost of green energy. This has left Germany more dependent on Russian gas at a time when Russia is, of course, playing geopolitical games.  As Jim Ratcliffe, chairman of INEOS, pointed out earlier this year, Germany and the rest of Europe need a sensible energy policy based around hydrocarbons. Shale gas is an obvious crucial part of the answer.

In 2004, German football was in a similar crisis and so underwent a complete overhaul which culminated in Sunday’s World Cup triumph.

Politicians and CEOs need to follow the example of the footballers by putting their own master plan in place.

Here are just a few ideas to get the debate going:

  • Developing the right  products and services to serve an ageing population.
  • Raising the retirement age, whilst encouraging employers to retain, take on, and retrain older people.
  • Coming up with an energy  policy that makes use of not only of shale gas, but also of a much more liquid and globalised natural gas market.
PREVIOUS POST

China's Q2 GDP Number Is Irrelevant

15/07/2014

By John Richardson WHAT a fantastic World Cup and Germany were deserved winners....

Learn more
NEXT POST

China Peak Manufacturing Season Disappoints

17/07/2014

By John Richardson WHAT a fantastic World Cup and Germany were deserved winners....

Learn more
More posts
China full-year lending decline confirms that Fed pause is a sideshow
15/01/2019

By John Richardson CHINA’S full-year 2018 lending figures are out and they underline what I’d be...

Read
Oil prices to be buoyed by new shipping fuel rules, despite economic slowdown
13/01/2019

Guest blogger today is Ajay Parmar. He is a chemical engineering professional with 5 years of indust...

Read
Turkey PE demand could be 8% lower as economic problems continue
11/01/2019

By John Richardson TURKEY’S apparent demand for PE may have fallen by 8% in 2018 to around 2m ...

Read
Flood of US LLDPE begins to disrupt markets with worse to follow
09/01/2019

By John Richardson THE ABOVE table illustrates the 2018 impact on smaller LLDPE markets of the arriv...

Read
US/China trade deal in March would likely quickly unravel
07/01/2019

By John Richardson YOU CAN bet on a rally in equity markets and in oil prices if some kind of deal i...

Read
China slowdown: After Apple, next wake-up call will be from auto markets
04/01/2019

By John Richardson THE NEXT big wake-up fall for global financial markets and the chemicals industry...

Read
The world in 2019: Social unrest, populist politics, trade barriers and global recession
02/01/2019

By John Richardson I PREDICTED in 2011 that the world would by a decade later be less globalised as ...

Read
Nothing the Fed can do to stop China causing a global recession
20/12/2018

By John Richardson US stock markets yesterday demonstrated their worst negative reaction to a US Fed...

Read

Market Intelligence

ICIS provides market intelligence that help businesses in the energy, petrochemical and fertilizer industries.

Learn more

Analytics

Across the globe, ICIS consultants provide detailed analysis and forecasting for the petrochemical, energy and fertilizer markets.

Learn more

Specialist Services

Find out more about how our specialist consulting services, events, conferences and training courses can help your teams.

Learn more

ICIS Insight

From our news service to our thought-leadership content, ICIS experts bring you the latest news and insight, when you need it.

Learn more