Germany’s investment in its infrastructure, machines and buildings has been insufficient, a review of data by Victor Perli, a left-wing member of the German Bundestag, has shown. The analysis, based on the country’s statistical agency, reveals that the investment is barely enough to offset the value loss of the existing infrastructure and not nearly enough to expand it.
Despite the “record investments” touted by former Finance Minister Christian Lindner, there is no evidence of a significant upgrade and this is particularly concerning at a time when the country is supposed to become climate-neutral, education levels are declining and new global competitors like China are emerging.
“Germany is driving on wear and tear” Perli told the Süddeutsche Zeitung. “Our infrastructure, machines and other equipment, which we need for our economy, are losing value and crumbling schools and collapsing bridges illustrate that too little is being invested.”
According to the review, the total investment by companies, citizens and the federal, state and local governments in the past year was approximately 908 billion euros. This represents a 117% increase from 1991, the first year after reunification.
However, the review also reveals two significant caveats. Firstly, when adjusted for inflation, the increase in investment amounts to only 13%. Secondly, the depreciation of existing infrastructure, machines and buildings has increased much more sharply, by 259% nominally and nearly 87% in real terms.
After subtracting these depreciation costs, the net investment in 2024 was a mere 19 billion euros. When these net values are compared to the country’s gross domestic product (GDP), a worrying trend emerges: the net investment ratio has decreased from 10.7% in 1991 to 0.4% in 2024.
Perli attributes this “dramatic development over the past 30 years” to politicians who “cling to the debt brake and fail to trust themselves to effectively tax the vast wealth of the top 1%.” This is likely a reference to Lindner and other top politicians. The data, however, suggests that a bold investment offensive is absolutely necessary. Even companies would invest more if they could rely on a functioning infrastructure, Perli argues. “We must finally take the money in hand to prepare for the future – future generations will thank us.