German wholesalers warn fiscal stimulus cannot replace structural reforms

By Rene Wagner and ⁠Miranda Murray

BERLIN, Jan ⁠13 (Reuters) - ‍German wholesalers expect only slight sales growth this year after stagnating in 2025, in what the BGA trade association said was ‍a sign that Europe's largest economy needed more than debt-financed stimulus ​to overcome structural problems.

The wholesale sector was set to grow by only 0.7% in 2026, ​said the BGA in its forecast published on Tuesday.

The sector, largely dominated by small and medium-sized enterprises, generates sales of around 1.7 trillion euros ($1.98 trillion) and provides roughly 1.9 ​million jobs.

"If the political framework conditions for SMEs don't finally change, we must expect even more insolvencies and even more job losses," BGA ​President Dirk Jandura said in a statement.

STRUCTURAL PROBLEMS NEED TO BE ADDRESSED

The lobby group found that more ‌than half of the companies in the sector recorded sales declines last year, and more than a third expected further ​losses in 2026.

Consumer goods have been stabilising ⁠the entire wholesale sector for several years, masking the sharp declines on the industrial side as it experiences a lack ‌of orders, layoffs and short-time work, said Jandura.

The wholesale industry's struggles as a whole reflect a structural problem in the entire German economy, he added.

Three-quarters of the ‌companies found the bureaucratic burden overwhelming, in terms of time and money, while 40% felt ‌they were at their limit in terms of energy costs and more than two-thirds were calling for a reduction in labour costs, said BGA.

The moderate growth forecasts for the ‍coming years were based on government consumption and state spending, Jandura added.

"This is not genuine organic growth; it is ⁠debt-financed stimulus," he added, referring to a series of fiscal measures, including a 500-billion-euro infrastructure fund.

"While debt provides short-term impetus, it does not address structural weaknesses in the long term."

($1 = 0.8571 euros)

(Reporting by Rene Wagner and Miranda Murray, editing by Thomas Seythal and Alex Richardson)

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