“We need a major effort in this country to get things moving again,” Friedrich Merz, the chancellor candidate for the conservative Christian Democratic Union said over the weekend, as his party announced “Agenda 2030,” which pledges to return German growth to 2 percent over the next five years through changes to the welfare and tax systems.

The German economy contracted for the second consecutive year in 2024, being the weakest economy again among eurozone peers. Europe's biggest economy contracted by 0.1% in the final quarter of last year and shrank by 0.

Simply sign up to the German economy myFT Digest -- delivered directly to your inbox. Germany’s economy shrank for a second straight year in 2024, underlining the severity of the downturn facing Europe’s manufacturing powerhouse.

Germany’s economy shrank for a second consecutive year in 2024 and is unlikely to grow much in 2025, laying bare the challenge for the country’s new government once snap elections are held in February.

The German economy contracted by 0.2% in 2024, in the second consecutive year of declines in the annual gross domestic product of Europe's largest economy.