In a letter to lawmakers, German Chancellor Merz described “certain sectors” of the German economy as being in a “very critical” state, adding that stimulating growth would be his government’s top priority this year. Although Merz did not specify which sectors he was referring to, the German automotive industry has been plagued by declining sales in parts of Asia, and its struggles have spread to other areas of the economy. Merz wrote: “Therefore, in 2026, we need to focus on making the right political and legal decisions to fundamentally improve the business environment.” He acknowledged that his government had not done enough to boost the competitiveness of the German economy during its first eight months in office. Mertz’s letter is part of the conservative chancellor’s effort to revitalize his government after a year of missteps. On Monday, he dismissed one of his closest advisers, Chief of Staff Jacob Schrot, and announced plans to replace him with Philipp Birkenmaier, the CDU’s party secretary who has close ties to the business community.