The thunderclouds over the Westerwald region gradually dissipated, but the exchange between students and Executive Board member Fritzi Köhler-Geib continued apace even after 21:30. While this was of course focused on the upcoming challenges facing the German economy, Ms Köhler-Geib also appealed to students to take advantage of the opportunities offered by digitalisation in Hachenburg – after all, this area is being expanded considerably in the curriculum there. It was only at around 22:00 that Ms Köhler-Geib left the Bundesbank’s University of Applied Sciences. “It was great that a member of the Executive Board took so much time for us,” said Mara Dreier, a student from the foundation course, following the discussion.

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High uncertainty a drag on economy

In her keynote speech, Ms Köhler-Geib – who holds a doctorate in economics – had addressed the cooled down state of the German economy, which has been moving sideways since the coronavirus crisis. As she noted, in contrast to previous business cycles, even the export industry was unable to turn the tide: “In 2010, Germany was the global market leader with a market share of more than 30 % in 240 out of 5,300 goods, while today this is true of just 180 goods.” Moreover, uncertainties, some of which are triggered by geopolitical tensions, are holding back German enterprises’ willingness to invest, she added. 

“Set the right incentives” 

Pointing out recent research findings, she said it was necessary to increase the labour supply in light of demographic change. “I see potential here, above all, in expanding the employment of women,” emphasised Ms Köhler-Geib. In addition, the share of the workforce above the age of 65 would have to increase from the current 8 % to 25 % in order to offset the shrinkage in the labour force that is set to occur over the next few years. In Japan, for example, the labour force participation rate for people over 65 years of age was 25 %, she noted. “It is also important that policymakers set the right incentives for employees,” said Fritzi Köhler-Geib. 

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A high bureaucratic burden is additionally hampering the economy. The Executive Board member substantiated this with charts on studies carried out by the Bundesbank’s Research Centre and the Kreditanstalt für Wiederaufbau (KfW). “For medium-sized enterprises, around four percent of working hours are needed to meet regulatory requirements,” said Ms Köhler-Geib. 

She said she was also aware that the Bundesbank itself created bureaucracy through its activities. That is why she, whose remit also covers data and statistics, was therefore pleased that the Bundesbank had now done something to reduce bureaucracy. Background: The Bundesbank raised the reporting threshold for foreign trade and payments from €12,500 to €50,000 at the beginning of 2025. “As a result, there has been a 15 % reduction in reports. We have calculated internally that this will save the reporting enterprises an amount in the double-digit million euro range,” emphasised Köhler-Geib. But that’s not all. The Bundesbank, together with other institutions, was also working on a uniform register of basic company data in order to avoid data being collected multiple times in the future, noted Köhler-Geib. 

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Another building block for strengthening the country as a business location was to strengthen the digitalisation of processes and procedures, she added. She also highlighted that the Bundesbank was already regularly using artificial intelligence in its day-to-day work, for example in the area of risk control and in speeches for Bundesbank President Joachim Nagel. The digital euro also offers great opportunities here, she noted.

Consistently exploit your own possibilities

One thing was particularly important for her in the debate on strengthening the German economy: “There are developments, for example due to geopolitical tensions, that are outside Germany’s control. This makes it all the more important for us to push ahead with the things that we can influence here ourselves.” 

© Dieter Roosen