Germany’s performance on sustainable, inclusive growth

| Video

McKinsey: How is Germany performing on inclusion, growth and prosperity, as well as on sustainability?

Fabian Billing: I think we are coming from a position of strength. Our GDP per capita has been growing by 1.1 percent over the last 20 years, which is roughly in line with the US, who have been growing by 1.2 percent. We also have a strong position in the sustainability and development goals set by the United Nations, which measure income equality and low emissions. We do a lot of R&D spending, so we invest in future technologies. We have a very low unemployment rate, and a very strong social system.

But still, we should look forward and say, “What are the things where we need to lift our ambition in order to become even stronger?” The first point would be on growth. I think we need to double our growth rate, and think we can grow by 2 percent per year. We need growth to be able to afford R&D investments, we need growth to be able to afford our sustainability transformation, and we need growth to be able to afford our social system.

The second point is sustainability transformation. We have an obligation to our next generation, and it’s non-negotiable. So we as Germany and Austria should be leading in sustainability transformation. We see it as an opportunity not only to transform our existing industries, but also to build a completely new industry segment, the clean tech segment. And I think we should have the aspiration to become the Silicon Valley of sustainability.

The third point is around technology transformation. We all know that technology is fundamentally important for future competitiveness. So we need to double down our investment in technical skills and technology capabilities. We must also carry out a massive migration of our workforce to more technology-oriented occupations.

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