Germany’s industrial base is now in deep crisis, with dramatic production declines across every sector — particularly in the automotive and pharmaceutical industries. The government is pushing debt-funded rescue packages as a solution, yet overregulation and the green agenda have already crippled the country’s competitiveness.
For years, anyone predicting the collapse of German industry was dismissed as pessimistic. But the production data released on Wednesday morning (October 8) paints a catastrophic picture across all sectors — and in the end, the pessimists were right.
According to the Federal Statistical Office in Wiesbaden, total manufacturing output fell by 4.3% in August compared to July, while industrial production dropped even further — by 5.6%.
The decline in the automotive sector is particularly devastating: down 18.5% month-over-month, according to the VDA industry association. This reveals a near-complete collapse of a sector that has already lost more than one-third of its production since 2018.
For all of 2025, industrial production is down 3.9% year-on-year, signaling a deep, structural recession in the German economy.
Even the pharmaceutical industry, usually resilient during crises thanks to aging demographics and stable pricing, is now faltering — production fell 10.3% from the previous month.
Government forecasts that defy reality
Against this grim backdrop, Economy Minister Katherina Reiche’s forecast seems almost absurd: she expects growth of 0.1%–0.3% for 2025 and 1.3% for 2026.
The government’s hopes rely on massive new borrowing packages designed to create short-term economic momentum — a brief gasp of air in an inferno.
This approach is a form of “voodoo economics”: generating new debt that will later be repaid by taxpayers through higher taxes and inflation, funneled toward the green transition and the war economy.
In this model of constant state intervention, where the middle class bears the burden, no genuine value creation is possible. Germany needs a return to free-market principles and sweeping reforms that address its fundamental problems — illegal migration and the overregulated Green Deal — with real determination.
Wounded by the “climate religion”
By now, the Chancellor and cabinet must grasp the gravity of the situation.
The expanding public sector cannot replace a real economy, and the heart of German prosperity — its industry — is collapsing. Over the last two years, 200,000 industrial jobs have vanished.
Germany’s strength lies in automotive manufacturing, chemicals, engineering, and construction — all sectors sacrificed as collateral damage of climate policy.
Last week, Friedrich Merz called for a national “investment turnaround.” But Germany has been losing billions in foreign direct investment for years — a clear sign of weak conditions and a hostile business climate.
The coming economic crisis is not a normal recession — it’s a systemic breakdown, one that will continue until Brussels, Paris, and Berlin are forced to confront reality and make fundamental policy reversals.
The dream of eco-socialism is over, as is the illusion of providing German-style welfare to the entire world. Both pillars of this new socialist vision have already collapsed.
Five minutes to midnight
Now come the desperate attempts to delay the inevitable — talk of tax hikes and superficial reforms that leave the welfare system untouched.
The final stage of economic collapse will be capital flight — and it has already begun. In the past year alone, €64.5 billion left Germany.
If the United States continues to strengthen its economy while deregulating, Europe’s future looks bleak.
Compared to the U.S., Europe’s overregulated, overpriced, and energy-dependent model cannot compete. Brussels already has its answer: the digital euro — a mechanism for capital control, a “digital wall” to contain financial flows.
Once it’s implemented, markets will receive a clear message:
It’s time to abandon the old continent.
www.bankingnews.gr
According to the Federal Statistical Office in Wiesbaden, total manufacturing output fell by 4.3% in August compared to July, while industrial production dropped even further — by 5.6%.
The decline in the automotive sector is particularly devastating: down 18.5% month-over-month, according to the VDA industry association. This reveals a near-complete collapse of a sector that has already lost more than one-third of its production since 2018.
For all of 2025, industrial production is down 3.9% year-on-year, signaling a deep, structural recession in the German economy.
Even the pharmaceutical industry, usually resilient during crises thanks to aging demographics and stable pricing, is now faltering — production fell 10.3% from the previous month.
Government forecasts that defy reality
Against this grim backdrop, Economy Minister Katherina Reiche’s forecast seems almost absurd: she expects growth of 0.1%–0.3% for 2025 and 1.3% for 2026.
The government’s hopes rely on massive new borrowing packages designed to create short-term economic momentum — a brief gasp of air in an inferno.
This approach is a form of “voodoo economics”: generating new debt that will later be repaid by taxpayers through higher taxes and inflation, funneled toward the green transition and the war economy.
In this model of constant state intervention, where the middle class bears the burden, no genuine value creation is possible. Germany needs a return to free-market principles and sweeping reforms that address its fundamental problems — illegal migration and the overregulated Green Deal — with real determination.
Wounded by the “climate religion”
By now, the Chancellor and cabinet must grasp the gravity of the situation.
The expanding public sector cannot replace a real economy, and the heart of German prosperity — its industry — is collapsing. Over the last two years, 200,000 industrial jobs have vanished.
Germany’s strength lies in automotive manufacturing, chemicals, engineering, and construction — all sectors sacrificed as collateral damage of climate policy.
Last week, Friedrich Merz called for a national “investment turnaround.” But Germany has been losing billions in foreign direct investment for years — a clear sign of weak conditions and a hostile business climate.
The coming economic crisis is not a normal recession — it’s a systemic breakdown, one that will continue until Brussels, Paris, and Berlin are forced to confront reality and make fundamental policy reversals.
The dream of eco-socialism is over, as is the illusion of providing German-style welfare to the entire world. Both pillars of this new socialist vision have already collapsed.
Five minutes to midnight
Now come the desperate attempts to delay the inevitable — talk of tax hikes and superficial reforms that leave the welfare system untouched.
The final stage of economic collapse will be capital flight — and it has already begun. In the past year alone, €64.5 billion left Germany.
If the United States continues to strengthen its economy while deregulating, Europe’s future looks bleak.
Compared to the U.S., Europe’s overregulated, overpriced, and energy-dependent model cannot compete. Brussels already has its answer: the digital euro — a mechanism for capital control, a “digital wall” to contain financial flows.
Once it’s implemented, markets will receive a clear message:
It’s time to abandon the old continent.
www.bankingnews.gr
Σχόλια αναγνωστών