Futuristischer, geschwungener Tunnel mit blau‑violetter Beleuchtung, in dem zwei Personen nach vorne gehen.

What does the future hold for industrial Mittelstand in Germany?

The scenario method approach

Scenarios are not predictions of future developments, but are to be understood as sharpened figures of thought or thought experiments. They help us to better understand the world and to categorise present events in medium to long-term future contexts.

Scenario 1: Delayed Modernisation

Party political tactics are preventing rapid reforms and investments, extremist forces are gaining ground. Germany is falling further behind in the competition between business locations. There is a gradual loss of competitiveness and innovative capacity in the German economy, while powerful companies from abroad are catching up. The intra-European and global disparity in location factors is leading to the relocation of large companies and SMEs, and value creation networks are disintegrating in some cases.

Scenario 2: National Transformation Efforts

In response to the crises of the 2020s, decisive political, entrepreneurial and social reactions are setting the course for an economic upturn in Germany, driven by a leading role in the digital and green transformation. For example, infrastructure modernisation is being accelerated and the social value of performance orientation is increasing. The accelerated pace of transformation offers opportunities, but also challenges for SMEs.

Scenario 3: Deeper European Integration for Resilience

The increasing withdrawal of the USA from Europe is creating momentum for deeper EU integration with security policy as a new nucleus. This also creates space for joint strategies in other fields, such as the data economy, raw materials, energy and the capital market. European cross-border innovation and value creation alliances are asserting themselves in a world with high volatility and rapidly changing alliances.

Scenario 4: Germany in a World Disorder with Bloc Formation

The systemic conflict between the USA and China is escalating into a decoupling of global trade activities. Germany's industrial SMEs are being put to an existential test. The loss of supplier relationships and sales markets must be compensated for in this challenging environment. There will be a long-term loss of prosperity in Germany.

Extreme Scenario: Germany in a disintegrating European Union

The extreme scenario as a thought experiment: As a result of massive tensions between the member states, which lead to an extreme blockade policy, the states agree to abolish the EU treaties. In the course of this, the euro is also abolished as a common currency and the Bundesbank reintroduces the Deutschmark. Resentments that were thought to have been overcome long ago resurface. All former EU states slide into a massive recession. Companies and politicians try to reorganise themselves in a panic.

"Scenario thinking can help anyone navigate important choices."

Recommendations for action

With five scenarios for the future of industrial Mittelstand in Germany in 2030, the BDI wants to encourage both politicians and companies to navigate well-founded despite the current complex and confusing times. The recommendations for action are based on the future scenarios for Mittelstand companies and show ways to improve the regulatory environment.