Germany’s Industrial Strategy 2030 Strongly Resembles Military Industrial Complex, Planned Economy

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Germany's Industrial Strategy 2030 Strongly Resembles Military Industrial Complex, Planned Economy

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On February 5th, German economy minister Peter Altmaier presented his 2030 Industrial Strategy. The strategy aims to improve the military industrial complex as well as the industry as a whole.

The strategy listed the areas in which Germany is a world leader and strives to reinforce its positions.

They include:

  • the steel, copper and aluminum industries;
  • the chemical industry;
  • mechanical and plant engineering;
  • the automotive industry;
  • the optical industry;
  • the medical device industry;
  • the GreenTech sector;
  • the defense industry;
  • the aerospace industry as well;
  • additive manufacturing (3D printing).
Germany's Industrial Strategy 2030 Strongly Resembles Military Industrial Complex, Planned Economy

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One of the main aims of the strategy is the clear objective of increasing industry’s share of gross value added in Germany to 25%, while the total for Europe should reach 20%.

The Mittelstand (small and medium-sized enterprises) should be strengthened and there should be heavy investment in artificial intelligence.

Altmaier’s strategy also includes the German state facilitating mergers between larger companies, creating “European Champions” as a result.

“The question is whether we voluntarily dispense with this market segment and allow it to be served by the USA and China alone, or whether we’re also entitled to be in this market. But this is only possible if mergers are permitted so that existing companies can reach necessary size,” Altmaier said.

According to the strategy, business should be forced to innovate.

But for “challenges which are fundamental to an economy,” the state should, for a limited period of time, be able to acquire companies’ shares or provide financial state aid to support the necessary mergers.

Bundesverband der Deutschen Industrie (Federation of German Industries) [the BDI] tweeted tweeted: “Concept was overdue, international competition doesn’t sleep! Proposals worth discussing, now a matter of how they’re shaped. Still underexposed: climate policy, high tax burden, industrial ‘Mittelstand’.”

EURACTIV cited Dr Tomaso Duso from the German Institute for Economic Research, according to whom the German Economic Ministry’s approach was wrong.

“The idea that the state knows better than the market what are the technologies, sectors and markets of the future is quite far-fetched,” Duso said.

“Protectionism and massive subsidies may be currently working in China. But the strategy of creating a bad and lightweight copy of this in Europe won’t succeed,” he added.

According to EURACTIV, the proposed strategy was a last-ditch effort to convince the European Commission to reverse its decision on blocking the merger between rail giants Alstom and Siemens.

“The EU’s rejection of the Siemens-Alstom merger demonstrates the urgent need for a European Industrial Strategy,” Altmaier said on Twitter on Wednesday (6 Febrruay). “It involves orders of many $100 billion worldwide. That is why we need strong European champions. France & Germany agree.”

While presenting Germany’s industrial strategy 2030, he said that EU merger rules should be reformed to allow the creation of “European industrial champions” with the size to compete against Chinese and US competitors.

Separately, a German Finance Ministry analysis showed that the country may be unable to deliver on its pledge to increase the defense budget due to smaller economic growth.

On February 10th, US Ambassador to Germany Richard Grenell criticized Germany’s pledge to increase its budget, claiming that it is not doing enough, in an interview with German newspaper Welt am Sonntag.

“Germany’s NATO promise to raise defense spending to 1.5 percent is not enough,” Grenell said. “Again, it is not US standards that have to be met here but NATO commitments that Berlin has already agreed to. The US is simply reminding its great German ally that now is not the time to undercut or weaken NATO.”

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  • Dick Von Dast’Ard

    Of course with the EU Army, Germany (and France) won’t need to remain in NATO.

    • grumpy_carpenter

      What they don’t have is the USA’s nuclear umbrella to protect them while they build up their forces. France has a few nukes but nothing like the weapons Russia possess. Germany went to war in 1939 because they didn’t have the resources to survive as an industrialized nation …. that is still the case. Europe is resource poor and vunerable. The USA is a resource rich , easily defended island fortress. Europe benefits more from US nukes than the USA does and building up a nuclear arsenal is expensive..

      I know the argument is Russia has no reason to invade or attack Europe however how can anyone assure that this will remain to be the case 10, 20 , 50 years down the road. I’m playing devils advocate here …. if I were a german I would want my leadership to consider all the strategic consequences of going it alone on defence.

      • Harry Smith

        Did you ever heard about the Great Europe from Brest (FR) to Vladivostok (RU)? Why should Germany be afraid of Russia, if they will be allies? BTW, Hitler in his Mein Kampf wrote that in the WW1 Germany should made alliance with Russia. Same thing wrote even von Bismarck before the WW1.
        On the other hand, all those EU countries which have US bases and weapons would be erased in the first place as the nearest threat. Those iskanders at Kaliningrad are for erasing Poland and Germany (because of Rammstein) and of course Norway with UK. Their range is about 500 km and you can freely draw some 500 km lines in the google maps. And as USA broke the treaty soon we will see some land version of kalibrs with 2000-3000 km range. So to possess any of USA military infrastructure in the EU is like screaming out of your mouth “kill us first”. Kinda suicide bomb belt a-la kebabs to protect you family from robbers.

        • Jens Holm

          Thats crap of the worst. So You think we are bow and arrows drinking tea, so You can hit us even with trembling vodka fingers.

          Yes, USA broke the treaty. But You still dont know why – do You. You never will.

          I will tell You. 1) Russia has broken the treaty by making some of those missiles again 2) Others a fx China makes many of them, so it make no sense making only peace in Europe by having none of them.

          Many countries can make almost all kinds of missiles and do. Several even can send things in orbit as well as far away.

          So if there can be no agrement will them, it make sense to join. I wished it was the opposite way and we had a deescaltion – but we are not in those matters.

          • Harry Smith

            Please allow me to share with you some info, my highly respected vis-a-vis from the island, as I understand from your reply.
            https://www.businessinsider.com/the-real-purpose-of-russias-poseidon-nuclear-doomsday-device-2019-2
            Maybe in the case of the UK, it is better to step aside and…

          • Sinbad2

            The US broke the treaty because they want a war in Europe, so they can get rich burying Europeans and rebuilding Europe.
            You just don’t understand that you are merely a lump of coal to them, something they can burn.

      • Dick Von Dast’Ard

        Well call me a tad suspicious, but I would be highly cautious about relying upon the Americans to do anything other than create massive amount of damage within Europe, in order to make a fast buck and a profit out of it.

      • Jens Holm

        Yes, we have to do something and cant just let it be. No one says we should follow Russia down as well. The whole world is not Russia.

      • Sinbad2

        Germany went to war in 1939 because the FUKUS countries refused to allow Germany to buy oil.

        Today FUKUS are demanding that Germany only buys FUKUS controlled gas.

        Russia and Germany will form an alliance, and might just go to war against FUKUS, although France is already beaten, so just UKUS.

      • Robert Ferrin

        We are no where as resource rich as you put on,one only needs to look at the imports to see that ,the marriage made in heaven is Germany and Russia one rich in ALL resources and the other its manufactering….

    • Jens Holm

      Hardly relevant at all. USA for good reasons has asked Nato in Europe to take more of their part.

      By that we in Europe do by this iniatives. More weapons are needed as well as they have to be for today and tomorrow and not coipies of yesterday.

      And of course Nato already has changed according to the cold war and by that has to change more. It will be more advanced equipment and less but much better educated soldiers. Many countries do that.

      • Dick Von Dast’Ard

        What has it got to do with the U.S.?
        If they don’t like it, then they can always allow Europe and Russia to progress.

        • Jens Holm

          I just wrote what it has to do with USA. USA has asked us to defend ourselves more and better.

          Very strange You have not heard Russia telling too many americans are in Eastern Europe.

          So we add our % of the whole cirkus up, and by that it will be less expensive for the americans. Why should we mainly use american weapons, if we here and there can make better and cheeper ones.

          Thats how I see it have been reading about it. USA was in their way out of Europe, but Putin and problems in the new countries changed that.

          • Dick Von Dast’Ard

            All the Americans want to do us sell more of their own weapons by creating the political circumstances (within Europe) for them to do so.
            INF treaty dissolution being a prime example.
            Personally if I was a military man, I would be salivating about the prospect of a combined European and Russian military force. (more than capable of standing up to any aggression from all four corners of the map)

          • Harry Smith

            True bro. The most logical move of USA to protect EU from the Russian nukes is to withdraw most of USA missile infrastructure from Europe. It’s a 100% stupidity to invest billions in North Stream just to destroy the buyers of gas. OSCE could be a wonderful institution if there were no Americans.

          • Jens Holm

            Your name is Chamberlain ?

      • Sinbad2

        NATO not Nato, it’s not a name it’s an acronym.

      • Robert Ferrin

        Of course we want you dumbies to buy more weapons and the reason is that we have a lot of dogs like the F=35 to get of and your the suckers on the list.!!!

  • Pave Way IV

    America’s industrial strategy:

    -Create a complex web of taxes, fees and deductions from worker’s paychecks to discourage both hiring and their incentive to work; small businesses are destroyed
    -Bleed middle class with more taxes and debt, then lie about inflation reducing purchasing power; workers demand/need more wages just to stay afloat
    -Offshore those US worker’s jobs because now they’re too damn expensive and an administrative burden to employ
    -Force manufacturers to buy cheap overseas components to stay competitive, further reducing payrolls
    -Raise minimum wage and import millions of economic migrants to clean toilets and fix roofs

    Industrial strategy is to asset strip, not invest. “Industry” is a bad investment in the US. At best: use profits to buy company’s own stock instead of making capital improvements. Hell, loan as much as possible to do the same – rates are low. Lavish owners and directors with artificially-inflated stock, making them millions. When you lose customers and the manufacturing plants are in shambles, sell it to someone else and cash in. Repeat.

    • Jens Holm

      WRONG PAGE: This is about GERMANS.

    • You can call me Al

      Very true indeed.

      • Robert Ferrin

        And this is what will happen if Germany follows the lead of the U .S.!!

  • Smaug

    This article should be labeled opinion, especially when geography predisposed Germany to be strong in several of these industries.

  • Rob

    In 1930 Germany was leading the world in science and technology. I am very happy to see Germany again leads the world.

    • Sinbad2

      Yes Germany Russia and China will form a mighty trade block, the rest of Europe will either join or enter a dark age.
      The USA will cease to exist, and be replaced with wasteland filled with cannibals, so not much different from today.

      • Jens Holm

        The world market and western economics dont work like that at all. A joke to put in Russia in that.

        • Harry Smith

          At the moment, western economy working as a bubble blower. After 2008 FRS an CB of EU started QE (kind of money print) in hope that corporations will invest the “cheap” money in production. But instead of it, corporations started to invest the money in “buy back” to increase the capitalization. And if capitalization grows, tops have extra bonus to their payments. So, right now, you are living pretty well not because your economies are so strong, but because you are robbing the future of your own children, who must pay the debt.
          So that’s why China is forcing the One Belt initiative – to redirect consumption from the EU and USA to One Belt counties and not to be dependent from the NY fanatics pushing their “Great Israel” wet dream.
          The most favorable scenario would be if China with help of Russia will slowly blow down the bubble by redirecting the money fluxes to the One Belt market and to take away from the Wall St. the control over the world reserve currency. But that’s won’t happen.
          The most realistic scenario is negative economic super cycle which morphs to the worldwide depression with a lot of chaos in the developed countries because of their high dependence of the infrastructure and enormous social payments.
          Literally, the hordes of “refugees” without free money from “mother Merkel” in EU and gangs of blacks and latinos without food stamps and welfare in USA.

          • Jens Holm

            I agree in Your first line. We has to avoid bubles like in 2008 and as You say, dont give parts of it to the unborn.

            EU do a lot for it making banks and others things more safe, but its not perfect all.

            I think You forget China is in that – buble maybee too. They cant sell and produce partly by us, if there are no buyers. China can grow by own consumption and is not new anymore. China by that has to renew, the new they have all over. Thats very expensive for billions and not only paint.

            By that China is a partner of the world economy partly in the same kind of boat.

            And I dont believe Russia can grow. I see a lower and lower economy dependent on exporting a few products only.

            I see no problems in big social payments. Its about what they are based on. Ours in Denmark are doing fine and we hardly has any depths. Our trade to others are plus in many billions as well.

            We hardly has corruption as well. Thats the point. We pay in high taxes and then we dont need private insurrancces as amny other have in bunches. So its also very much about having a state, which You trust.

            We do have problems in several banks as well as sveral companies hardly pay tax, but we work hard by EU to change those bad relations.

          • Harry Smith

            First to clarify your words about corruption in Denmark and safe banks in EU:
            – corruption – Danske bank
            – safe banks – Deutche bank
            Do I need to write more about it or this info is enough for you?

            As for China, maybe you did not read with attention my reply. China has to build new markets in the One Belt countries. I.E. India allowed Chinese companies to build 5G infrastructure in the country, and Chinese companies have all chances to be successful. Low cost hardware will lead to more qualitative infrastructure, which with 1 bln of citizens in India makes a perfect investment in a enormously large market. As bonus, in India, 5G services quality has to be much higher than in EU and USA. That means faster development of different related industries like programming. If Indians programmers now are working mostly for the USA, there is a good chance the internal market will became more attractive for them. It is like a chain – one leads to other.

            And about Russia. Yes we have internal and external issues, but thanks to sanctions, now we have self-sufficient economy with huge amount of gold as state reserves. In fact, Russia does not need to increase the export, instead it must increase the volume of the internal market. Like I said before, thanks to sanctions our agriculture is growing, our industry is growing because we were limited to buy high technology products at the global markets. Well, if we will take in consideration the upcoming global economic crisis I would bet rather on Russia than on Denmark with 50% of exports in it’s GDP.

          • Jens Holm

            Yes. Danske Bank are very bad news for the world and us. Its mainly made in Estonia but it semes the leaders of it here in Denmark also has looked away knowing it.

            We try to change things, so it cant happen again. There is not enough control for black money as well as tax avoiding. Even not in it, I feel ashame.

            As You write it unfornatly is a very big system also involving fx Deuche Bank. I dont think the our Goverment, we have now, do enough against the banks and other kinds of money flow.
            ……………………………………………………………….

            I dont disagree about fx 5G in India, but I see it as the cake grow and is selfmade and its on time people in that kind of the world can have better lives as us. I do remember in the old days, where we every year sended a lot of food aspecially to India and I do remember all the ones starved to deatth by Mao and othere. Seeing people starve and die being hartly ribbons is bad even to look at.

            Unfortunatly I dont see the same for Russia at all. Putin didnt tell something like growth when he not long time ago told pensions would be devastating reduced.

            I infected – so to speak – I dont see Russia devellop apart from weapon for oil to Syria as well as agriculture since improved a little bit for export. I hope I am wong.

          • Harry Smith

            Well, lets face the truth: there is no country in the world without corruption. The bigger country is – the more complicated government system is used. More complicated system of governance means more possibilities for corruption. Look at the USA – they made corruption lawful and named it lobbyism. You can officially buy any USA politician and show it in your firm’s experiences to reduce the taxes. So, please don’t compare little Denmark with such big countries like Russia, USA or China.

            As for the Deutche bank, it was mentioned not because of corruption but because of it’s amount of toxic assets.

            And about Russia: please give me the link where Putin says about reducing of pensions. BTW, try time to time watch Russia Today. Maybe you will correct your opinion about Russia.

            PS if you remember Mao you are pretty old. Please pardon me if I have insulted you in any possible way. I didn’t knew about your age.

        • Sinbad2

          First point the west is not the world market, and if you bothered to look, you would see that compared Asia, the west is shrinking. In a few more years, western economics will be as important as the Maginot line is today.
          You are living in a world long gone old man.

          • Jens Holm

            I dont se wet is schrinking. I see the world market is growing, so the cake to share becommes bigger.

            I You were correct, the west would become more and more poor. I dont see that at all.

  • goingbrokes

    Oh dear, the marxist economic model marches on even in Germany. “We need to create industrial champions!!!” “Heavy investment… ”
    I agree with Duso, this is all upside down central planning, which will have to hide their failures behind various fig-leaves of minor achievements.
    God bless Germany, because no one else will, and NATO is ready to wreck central Europe again in a stupid war… But do keep those military investments up because.. well because they are stupid!

  • Albert Pike

    Countries who are preparing their economies for war do stuff like this…

    • Sinbad2

      Exactly the Us is doing the same thing it did before it invaded Iraq, they only have one plan.
      But people just refuse to accept that the biggest war criminal the world has ever seen, would start a nuclear war.
      Like sheep walking to the abattoir they just don’t believe they will kill them.
      The basic fight or flight instinct no longer seems to exist in western nations, so extinction would be natures way of fixing that.

  • Brother Thomas

    Frankly, I find nothing particularly ominous in the list.

    So how should a leading, global, science and technology-based, diversified, manufacturing economy look?