Germany's businesses want Berlin to walk its talk

Optimism was further boosted when coalition negotiations between Merz's Christian Democratic Union, alongside its sister party the Christian Social Union, and the Social Democratic Party, triggered a major fiscal shift that is set to enable higher spending on defense and infrastructure.The CDU, CSU, and SPD now form Germany's coalition government, and the sense of enthusiasm from es has persisted as the coalition's political term has gotten underway, according to leaders who have spoken to CNBC in recent weeks."We have, as you heard before, a minimum of 10, maybe 20, years of weak political decisions, very ideologically driven, not driven, not society driven, and it seems to be that the new government is going in a different direction," Thomas Schulz, CEO of construction company Bilfinger, said earlier this month.watch now4:5304:53Low ductivity needs to be addressed in Germany, says Bilfinger CEOEurope Early EditionElsewhere, financial services vider Allianz's CEO Or Bäte welcomed the new government's apach to take competitiveness seriously, with Merz having repeatedly pledged to get Germany's industry back on track to push for global leadership."I can only applaud them for taking it seriously, to also mobilize financial reserves to put an unheard of investment gram into place, and also end almost two decades of lethargy of under investment in infrastructure, under investment in military, defense [and] under investment in education," he said.Leading German es in July announced their own initiative, with the goal of boosting investor interest and confidence

The group made up of 61 companies plan to collectively invest 631 billion euros [$737.4 billion] by 2028.watch now12:1212:12Demand to keep data in Europe high, says Deutsche Telekom CEOSquawk Box Europe"This is a good signal, and it shows that there is an alliance between [the] corporate world and the these days, which is very important, which hasn't been the case over the last years," Timotheus Höttges, the CEO of Deutsche Telekom told CNBC.The tone struck by leaders is also reflected in recent data, with economic institute Ifo reporting imvements in company sentiment for five consecutive months now.Call for actionHowever, es are also calling the government to action, demanding that campaign mises be turned into reality.Allianz's Bäte told CNBC that while the government's attitude was good news, "now comes the dery," and Bilfinger's Schulz noted that "there is at the moment only lip service in a lot of areas, with very good ideas, but we have to come to execution."Economists surveyed on policy by Ifo and German news organisation Frankfurter Allgemeine Zeitung also noted the lack of measures that have been implemented so far during Merz's term."30% of the participating economists rate the economic policy measures of the new German government in the first 100 days as 'rather negative', with a further 12% even rating them as 'very negative,'" the survey found.Participants negatively highlighted "the lack of reform efforts in the area of social security systems

In addition, they see a lack so far of stimulus for further structural reforms, the reduction of bureaucracy, and gress on climate tection," it noted. leaders had an extensive wish list to with CNBC.Roland Busch, CEO of conglomerate Siemens, was among those who called for structural reforms

Some of which included "digitalization, faster decision cesses, less bureaucracy, working [on] our energy transformation" and changes to the labor market.watch now2:1902:19EU-U.S. trade deal triggers investments, says Siemens CEOEurope Early Edition-specific needs were also called out by leaders, with Deutsche Telekom's Höttges saying the company could be supported by local authorities and the federal government in its build out of fibre infrastructure.Many of these issues were also flagged by leaders as reasons for the economic weakness of recent years

Europe's largest economy then recorded gross domestic duct growth of 0.3% in the first quarter ed by a 0.1% contraction in the ing period, according to data, in the second quarter."In Germany, we have not been growing as a country in the last two years, and there are reasons behind that

It's bureaucracy, it's education, it's security, energy prices, and in that context, being competitive on a global scale," Carsten Knobel, CEO of chemicals and consumer goods Henkel, noted."But we need to turn around this country from a not growing country back to growth," he said.