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Corona: Ministry of Economy coordinates pandemic production

by drbyos

Brussels, Berlin, Dusseldorf The question has arisen again and again in recent weeks – and again and again Minister for Economic Affairs Peter Altmaier avoided it.

Pressed by MPs from the Economic Committee, Altmaier referred to the responsibility of the Federal Ministry of Health. The CDU politician, of all people, who has staged himself as an industrial strategist since taking office, has long refused to pursue a corona-specific industrial policy.

Economic State Secretary Thomas Bareiß (CDU) pleaded a week ago in the Handelsblatt for a decentralized, market-driven approach. He is building on “subsidiarity and our federal structure,” said the Altmaier confidant. Locally, supply and demand would come together better “than if it were controlled centrally from Berlin”.

Now the ministry is changing course: This Wednesday, it is supposed to present a draft resolution drafted together with the ministry of health to the federal cabinet. The most important element is the creation of a staff unit to coordinate the production of pandemic supplies.

Coalition circles say that Chancellor Angela Merkel (CDU) is said to have put pressure on the Ministry of Economic Affairs. In her own words, Merkel is striving for a “pillar of in-house production” in Germany and Europe. It is high time for this, the coalition partner believes.

“I see a high level of willingness in many companies to switch,” said Ute Vogt, spokeswoman for the SPD parliamentary group, told the Handelsblatt. “But it needs a quick and well-functioning mediation – I see the duty of the Minister of Economy.”

BDI demands quick political control

In fact, the economy shows initiative. A number of companies have already started pandemic production. Volkswagen produces components for medical devices with 3D printers. Instead of herbal liqueur, Mast-Jägermeister burns alcohol for disinfection. Textile companies like Trigema manufacture protective masks.

However, that alone is not enough to meet the enormous need for corona protective goods. The Federal Association of German Industry (BDI) therefore calls on the federal government to start political governance quickly.

“The important help from industry must not be wasted in unstructured actionism,” said Iris Plöger, member of the BDI executive board, Handelsblatt. The industry can only help in the procurement of corona protective goods and medication if the need, precise product requirements and legal certainty for a quick market approval are clear. “This has to be coordinated centrally at the federal level,” said Plöger.

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In a statement on the corona crisis, which is available in the Handelsblatt, the BDI calls for government investments in the “construction of a test infrastructure” and payments to companies so that the “investment costs can be absorbed for the common good”.

In order to “avoid capacity bottlenecks caused by pandemics”, state action is required, since no company can afford to “provide the necessary structure in the event of one-time overproduction in free competition”.

Government wants to build “pillar of in-house production”

The BDI paper reads like a blueprint for the new staff unit that is to be located in the Federal Ministry of Economics. Altmaier will not get in the way of the Ministry of Health: While Spahn is responsible for shopping on the existing market for protective goods at home and abroad, the Ministry of Economic Affairs is to initiate the creation of additional production capacities, i.e. to increase the offer.

The Federal Government’s aim is “to set up a pillar of in-house production in Germany and Europe in the medium and long term in addition to the short-term supply of protective equipment, in order to reduce dependencies in this sensitive area,” explains the Ministry of Economic Affairs.

If the first steps towards normalizing everyday life are taken in the coming weeks, the demand for protective goods will continue to increase. Bavarian Prime Minister Markus Söder (CSU) already said that he expected a general mask requirement.

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Politicians must also take into account the needs of companies “in order to ensure orderly operation for the phase of restarting the economy”, demands the BDI. Many companies worked “in compliance with the highest hygiene standards and are urgently dependent on personal protective equipment”.

The BDI fears bottlenecks not only with breathing masks and protective coats, but also with raw materials and reagents that are necessary for the manufacture of medical goods and medicines. This applies above all to the virus tests, which are to be greatly expanded according to the plans of the federal government.

“While most of the devices and test procedures are available, the necessary reagents and auxiliary materials that are necessary for testing are a problem,” warns the BDI.

In order to remedy the “massive lack of respiratory masks”, the BDI suggests “simplifying the licensing of protective goods”. The association also campaigns for “the lifting of EU export restrictions on corona goods”. These endangered the delivery of medicines and medical devices.

I can only say that funding can hardly be used more sensibly. Thomas Jarzombek, Federal Ministry of Economics

The Ministry of Economic Affairs does not rule out either, but initially wants to use other industrial policy instruments. For example, funding for the development of a corona vaccine is to be increased.

As the Handelsblatt found out, the Ministry of Economic Affairs is providing another 1.3 million euros for a Tübingen start-up team that is pursuing a particularly promising approach. “The search for a vaccine against the novel corona viruses is a race against time,” said Altmaier’s start-up representative Thomas Jarzombek. “I can only say that funding can hardly be used more sensibly.”

The opposition criticizes that the change of heart in industrial policy comes too late: “Many weeks after the crisis, the federal government founds a planning staff. Many could have done that earlier, ”said Katharina Dröge, spokeswoman for the Greens’ political group. “So valuable time has been lost.”

EU Commission has placed bulk orders

The CDU’s economic council looks ahead: “Germany needs an official list of strategic areas, systemically important companies and products at European and federal level in order to guarantee supply chain security for these important areas for future crises and pandemics,” says a position paper by the Economic council available to the Handelsblatt.

One thing is clear: the other European countries are struggling with similar problems to Germany. There is “a global scramble” for scarce protective equipment and other medical goods, said EU Commissioner for Crisis Management Janez Lenarcic on Tuesday. “The virus has spread faster and further than anyone expected.” The shortage in Europe had become apparent when Italy unsuccessfully asked the other EU countries for deliveries in early March.

Handelsblatt Morning Briefing - Corona Spezial

The Brussels authority is trying to coordinate national activities. So that the EU countries do not outbid each other on the market, the Commission has placed bulk orders with the manufacturers.

The first contracts for the supply of goggles and masks have been signed, according to Lenarcic. At the same time, the Commission is using computer models to predict the peak of the epidemic in each country in order to deliver the goods there in good time.

More: Manufacture of medical material: companies mobilize themselves. Read more here.

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