Germany’s Merz Needs to Move Fast to Succeed with Economic Turnaround

With hundreds of billions of euros in state financing at hand, Chancellor Friedrich Merz has Germany poised for a historic leap. But his window of opportunity is narrow and could start closing within a few months.

A debt-fueled spending package — which Merz secured before taking power last month — has potential to add more than €400 billion ($470 billion) to annual output by 2030, according to the German government’s panel of economic advisers. That could boost the average growth rate by 1.6% over that period — slightly more than the trend since reunification in 1990.