Scholz criticised for hosting economic summit without key ministers

German Chancellor Olaf Scholz has come under fire for not inviting his ministers of finance and economy to a meeting with representatives of businesses and trade unions in Berlin on Tuesday.

Finance Minister Christian Lindner from the FDP or his Economics Minister Robert Habeck (Greens) were not part of the so-called industry summit, leading critics to accuse the chancellor of shutting out other parties and going into campaign mode 10 months before the next election.

Defending Scholz on ZDF television, Social Democratic Party leader Saskia Esken said it was “completely normal” for a chancellor “to take the helm in such a crisis situation”.

But according to conservative newspaper Die Welt, Lindner would definitely have preferred to have joined the event.

In response, Linder has scheduled his own meeting with small and medium-sized enterprises and representatives of skilled trades on the same day as Scholz’s summit.

He continues to insist that the government complies with the German debt brake, which restricts Germany’s structural budget deficit to about 0.35% of its gross domestic product.

The finance minister is justifying his “counter-event” as a necessary measure in light of Germany’s current economic crisis and possible plant closures at Volkswagen.

Meanwhile, Habeck — very likely the Green candidate for chancellor — has responded to the Scholz’s summit by presenting a paper with his own economic analysis, focusing on macroeconomic policy, interest rates and fiscal measures. In it, he calls for billions of euros of public investment.

Europe’s growth problem

Inan interview with newspaper Süddeutsche Zeitung, IMF Europe chief Alfred Kammer pointed out that not all policies which work in the US are viable in Germany and Europe.

“European companies are much less productive than American ones,” he said. “There are long-term obstacles to growth in the EU: the annual decline in the labour force, the massive bureaucracy and the lack of a true single market.”

In Germany, the government’s planned reduction in bureaucracy has been heavily criticised by employers’ associations. But according to Kammer, the structural reforms planned by Lindner are “indispensable”.

“The public sector in Germany must also invest more, as there can be no productive economy without a functioning infrastructure. A lot has been left undone here in recent decades,” he added.

Scholz, meanwhile, recently announced that “we need to get off the theatre stage”. This may be why there seems to be no press conference scheduled after the summit on Tuesday.