Chancellor Olaf Scholz confirms Green Tech Investment stirring Slow Economy in Germany

Chancellor Olaf Scholz announces this week in an interview with public broadcaster ZDF، that upcoming green tech investments in Germany helping revive growth in Europe’s largest economy as spending on renewable energy sources، hydrogen production as well as related networks will  have an impact on the entire economic activities since the government has moved at an incredible speed and have amended a range of legislation so that finally sufficient construction for its needs has gotten off the ground.

Bloomberg reported that economy in Germany، Europe’s largest gross domestic product، stagnated during the second quarter following a winter recession، weighed down by high energy costs، a lack of skilled labor and rising interests rates in the euro-zone، as Chancellor Olaf Scholz stated and demanded more investments on green tech and renewable energy to stimulate the entire economic activities.

Chancellor Olaf Scholz: Germany to spend more on green tech and renewable energy

Chancellor Olaf Scholz warned that industrial output، a leading indicator for any recovery، continued to slide in June، led by cars and construction، and Germany struggles have triggered calls for the government to extend a cap on power and gas prices for companies and households، in addition to spend more on green tech and renewable energy in order to achieve positive effect. 

Chancellor Olaf Scholz indicated that while Germany works through its immediate hurdles، the government is plowing multi-billion euro subsidies into attracting chipmakers such as Taiwan Semiconductor Manufacturing Co. that agreed this month to build a €10 billion ($11 billion) plant in eastern Germany in partnership with Infineon Technologies، NXP Semiconductors and Robert Bosch in order to invigorate green tech and renewable energy.

Germany agreed to €10 billion in aid to invigorate green tech

However، the commitment is another coup for Chancellor Olaf Scholz، whose party has been overtaken in the polls by Germany’s far-right AfD، after the government agreed to €10 billion in aid for a new Intel Corp. plant in Magdeburg as part of its efforts to invigorate green tech and renewable energy.

These companies aren’t investing due to the government subsidies، Chancellor Olaf Scholz explained، but they picked Germany for its strong economic، that Taiwan Semiconductor Manufacturing Co.، TSMC، the three-party ruling coalition will provide as much as €5 billion in subsidies.

Scholz’s coalition، with his left-of-center SPD، the Greens and liberal FDP، is currently some way from gaining a majority in the polls as in a survey run by ZDF، only 21% of respondents said they believed Chancellor Olaf Scholz could push through his agenda.

Cooperation between China and Germany in green tech and renewable energy

Furthermore، on the morning of June 20، 2023، Premier Li Qiang of China State Council and German Chancellor Olaf Scholz co-chaired the seventh China-Germany inter-governmental consultation at the Federal Chancellery in Berlin to revive many fields including، green tech and renewable energy.

Premier Li Qiang of China and Chancellor Olaf Scholz heard reports on the progress of China-Germany cooperation in relevant fields from the responsible officials of 22 departments including foreign affairs، economy and trade، industry، finance، justice، transport، education، science and technology، green energy، health، environmental protection and development.

Premier Li Qiang assured that the consultation with Chancellor Olaf Scholz was efficient and pragmatic، and achieved fruitful results، as well as China and Germany should join hands and cooperate more closely to contribute more to world peace and development، play the role of stabilizer in the changing situations، and accelerate the transition to green tech and renewable energy as well as the building of a community with a shared future for humanity.  

China and Germany to become partners in green development

The Chinese side proposed that China and Germany become partners in green development، strengthen communication and coordination on green and environmental protection issues، promote the research and development of green energy technology and industrial technology upgrading، and deepen cooperation in such fields as new energy vehicles، green finance، and third-party markets as the two sides should seize the opportunity of green transition and promote the upgrading of cooperation.

China and Germany should adhere to a pragmatic and open attitude to better achieve mutual benefit and win-win results and the two countries should also strengthen cooperation in global economic governance، ensure the stability of international industrial and supply chains، and promote an early recovery of the world economy as well as encourage the transition to green tech and renewable energy.

Special importance of Germany-China relations

Chancellor Olaf Scholz revealed that the inter-governmental consultation mechanism reflects the special importance of Germany-China relations as the German side is ready to maintain close communication with the Chinese side on all issues between the two countries and jointly address global challenges such as climate change، food security and debt problems as well as renewable energy and green tech. 

Germany and China have close ties in economy and trade as well as two-way investment and Germany has no intention to decouple from China، even it is ready to strengthen bilateral and multilateral cooperation with China to promote world development and prosperity after they agreed that China-Germany cooperation enjoys a solid foundation and is full of vitality. 

Cooperation mechanism on climate change and green transition

It is in the interests of both sides to deepen cooperation at a higher level، with higher standards and higher quality، and to jointly maintain the stability of the global industrial and supply chains، which is also of great global significance، in addition to set up a dialogue and cooperation mechanism on climate change and green transition، high technology، new energy، and digital economy.

 proposed tackling climate change as one of the guiding visions for China-Germany cooperation in the future and the two countries should promote cooperation in green technology and industry، and explore the establishment of a rational and orderly division of labor in the green energy industrial chain as well as climate response and green development.