German Chancellor Friedrich Merz has launched a sweeping overhaul of the nation's economic landscape, targeting stagnant growth with aggressive structural reforms. The package, unveiled on Thursday, includes contentious new German sick leave rules that force employees to provide medical certificates from the very first day of illness. These changes are central to the broader Friedrich Merz economic policy 2026, which aims to boost national competitiveness through tax relief and pension restructuring.
The coalition government faces an urgent need to revitalise Europe's largest economy. Germany's growth forecast for 2026 has been halved to 0.5 per cent, as the country struggles with high energy costs and increased competition from Chinese markets.
