German wholesalers warn fiscal stimulus can't replace structural reforms

BERLIN, Jan 13 (Reuters) - German wholesalers expect slight growth of 0.7% this year after stagnating last year, in a sign that industrial wholesalers need more than debt-financed stimulus to overcome structural problems in Europe's largest economy, the BGA lobby said.

Consumer goods have been stabilising the entire wholesale sector for several years, masking the sharp declines on the industrial side, which is experiencing a lack of orders, layoffs and short-time work, said the BGA in a statement on Tuesday.

"This is not just a problem for the wholesale sector; it reflects a structural problem in the entire German economy," said the BGA, adding that the moderate growth forecasts for the coming years are based on government spending.

"This is not genuine organic growth; it is debt-financed stimulus," BGA added, referring to a series of fiscal measures, including a 500-billion-euro infrastructure fund.

"While debt provides short-term impetus, it does not address structural weaknesses in the long term."