If we want to put Germany on a higher growth trajectory while successfully managing the transformation, we need to pay more attention to young, high-growth companies – for instance, in areas such as AI or battery and hydrogen technology – that can disrupt existing systems. These startups can only grow significantly through capital markets. When it comes to the transformation, there is often an immediate question about how much the government is going to pay for it. But that's not how it should work. We're talking about risks that the government doesn't necessarily have to and should not bear. It's about private investments and financing.

In Germany, there is a general lack of stock market culture, which means a lack of understanding of investing in broadly diversified, low-cost funds. In this regard, we are still lagging far behind countries like Sweden or the United States. We are a nation of savers, and at the corporate level, bank financing still predominates. All of this has its merits, but perhaps this is why we haven't recognized the importance of strong capital markets for a long time. However, it's time to take action now if we want to increase medium- and long-term growth. The situation in this regard is quite concerning because Germany's potential growth is currently at a historic low.

That's true in principal. However, in the corporate sector, there are levers that we could use to effect change relatively quickly. In a country like Germany, known for its inventors and thinkers, there should be no shortage of promising projects. Capital is also generally available on the investor side. Many other approaches to fostering more growth, such as addressing the issue of insufficient working hours or outdated capital stock, take longer to yield results. It's different with the capital market. I believe that a positive change could also occur among the general population more quickly than many people think.

In our annual report, we make the proposal to start with children and teenagers – not just with better financial education in schools but also with a government-provided initial capital.

It's somewhat modified. In Israel, government payments begin at birth. We propose starting at the beginning of formal education and then paying each individual €10 per month until they turn 18. If fully funded by the government, this would cost about €1.2 billion per year. This money could contribute to wealth accumulation. If we were exposed to a stock market culture from an early age, the investment teams in insurance companies, pension funds, or other capital aggregators would eventually be structured differently.

A state-managed pension fund could also contribute to a more dynamic stock market culture, as seen in Sweden. This is greatly aided by the experience of receiving regular personal statements from the fund. However, the generational capital, as planned by the federal government, is more of a financial market transaction.

We take out loans and invest the funds in the capital market. The returns on these funds are intended to support retirement income. However, individual accounts for future retirees are crucial. This would also foster trust, security, and hopefully, interest in the investments made. I was disappointed that this aspect didn't make it into the coalition agreement. But it's unlikely that anything can be changed in this legislative period.

Such a fund is not provided for in the generational capital. However, given the negative experiences with the Riester-Rente, such a fund would offer the possibility to implement an entirely different concept and a simpler approach. Individual accounts could also be used for the initial capital we propose.

The current obstacles, which do exist, do not sufficiently explain the reasons for the lack of investments, the reluctance of German insurance companies to allocate more funds to venture capital, or the limited development of securitization markets. Excessive regulation alone cannot fully account for this phenomenon.

In Germany, we have essentially found our own path with covered bonds. In reality, there isn't a significant obstacle to securitize more. It seems to be more a lack of interest. We don't necessarily see a need for a more lenient risk weighting. There are still opportunities available.

For instance, exit options for venture capital should be enhanced, both in Germany and other neighboring EU countries. This includes simplifying listings on stock exchanges and improving the attraction of investors. We've observed that early-stage venture capital financing has improved in Germany, with government support from institutions like KfW. However, there is a gap in growth financing when companies transition out of their startup phase. There aren't enough funds and other investors available in both Germany and Europe for this stage, which is quite unfortunate. The startup scene in Germany has generally shown positive development.

Co-financing is important to mobilize private funds. However, the way it is structured in Germany doesn't necessarily attract investors in late-stage financing rounds. By the way, it can also work without a lot of additional funding: In France and the UK, recent government calls have helped to encourage more investment in young, innovative companies.

Yes, along with strengthening supervision, particularly the European Securities and Markets Authority (ESMA). For some issues, it may remain challenging in the future, such as the harmonization of insolvency law, which would be crucial. Perhaps some EU countries should initially agree on harmonization in smaller groups.

Both in Germany and in Europe, it's currently a good time for this. The geopolitical situation has changed, and we should ensure that the EU doesn't become a pawn between the USA and China but remains an independent player, even in the financial markets. This gives me hope that progress will be made, especially when the new EU Commission starts its work next year.