German Chancellor Friedrich Merz on Wednesday said that the country was returning to economic growth after three years of recession, pledging a renewed focus on expanding the economy.

Mr Merz made the remarks after a two-day cabinet retreat at Neuhardenberg Castle in Brandenburg, expressing confidence in Germany’s economic prospects.

“We have three years of recession behind us, and now we are growing again,” Mr Merz said, stressing the need for a stronger focus on economic growth.

He said Germany was entering the remaining months of 2026 with “energy” and confidence, expressing optimism about further economic progress.

Germany’s economy has experienced prolonged weakness, with minimal growth expected this year amid the impact of the Iran war and rising oil and gas prices.

Recent indicators, however, have pointed to an improvement, with Germany’s Ifo business climate index recording another rise in August.

The economy grew by 0.3 per cent between April and June compared with the previous quarter, according to the Federal Statistical Office.

Mr Merz said the cabinet retreat focused on innovation and competitiveness, particularly the use of artificial intelligence (AI) across key sectors.

He identified industry, skilled trades, small and medium-sized businesses, defence and medicine as areas where Germany could benefit significantly from AI.
(NAN)