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2008 OECD Economic Surveys: Germany 2008

image of OECD Economic Surveys: Germany 2008

This 2008 edition of OECD's periodic survey of the German economy finds Germany enjoying a vigorous recovery after a long period of stagnation. To keep the recovery going, OECD finds Germany facing a number of key challenges including making the tax system more efficient, making labour market improvements last longer, improving education outcomes, strengthening competition in network industries, and making healthcare sustainable. These challenges are all addressed in some detail in this report.

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Reaping the benefits of stronger competition in network industries

The potential to strengthen productivity growth and enhance consumer welfare through more competition is large in the energy and railway sectors. Lowering entry barriers, including through the option of stronger forms of vertical separation between network access provision and potentially competitive services will be the main challenge for Germany going forward. In particular, it will be a crucial point in designing the envisaged privatisation of state stakes in the railway sector market incumbent Deutsche Bahn AG. In the energy sector, concentration in the wholesale market is another crucial issue that Germany will need to tackle, including by fostering market integration with neighbouring countries as well as market entry of newcomers. A more systematic approach to tendering unprofitable transport services will be key in the railway sector.

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