Economists have warned that the AfD’s economic programme could create a multibillion-euro hole in public finances while weakening investment, employment and regional competitiveness in Germany.
The warning comes as voters in Saxony-Anhalt and Mecklenburg-Western Pomerania prepare for state elections. According to a report by the German financial publication Capital, calculations by the Halle Institute for Economic Research (IWH) suggest that implementing the AfD’s promises in Saxony-Anhalt alone would leave an annual funding gap of at least €2.2bn.
That gap would arise from the combination of higher promised spending, tax reductions and the proposed sources of finance. It would amount to a substantial share of the state’s budget, which is about €15bn, raising questions over how the party would pay for its programme without cutting services, increasing borrowing or abandoning key commitments.
A programme economists say is ‘unfunded’
Reint Gropp, president of the IWH, described the AfD’s plans as “unfunded”. His assessment goes beyond a dispute over individual budget lines: it challenges the party’s attempt to combine generous political promises with lower taxation and a narrower role for the state.
The calculations relate specifically to Saxony-Anhalt and should not be treated as a forecast of an identical deficit across Germany. They do, however, illustrate the scale of the financial strain that could emerge if the programme were put into practice at regional level. The state’s relatively modest budget means that a €2.2bn annual shortfall would not be a marginal adjustment but a structural problem.
The AfD’s approach also includes rolling back renewable energy and restricting the recruitment of foreign workers. Economists have warned that both policies could damage the conditions on which investment and regional growth depend. Curtailing renewable energy would affect the direction of economic modernisation, while limiting access to overseas workers could deepen shortages of staff in sectors already dependent on qualified labour.
Isolation from Europe’s skills and research networks
Particular concern has focused on the party’s opposition to the Bologna system, the European framework that helps align university degrees and supports the movement of students and qualifications across national borders. Abandoning it would risk separating German regions from the wider European education, research and labour market.
For Saxony-Anhalt, economists say that kind of separation could have consequences well beyond universities. A less connected higher education system would make it harder to attract students, researchers and skilled employees, while an increasingly restrictive labour policy could reduce the pool of people available to employers. The result, they warn, could be a combination of a worsening skills shortage and declining investment appeal.
The warning is particularly significant because the AfD’s proposals are presented not simply as budgetary changes but as a broader economic direction. Reducing European integration, limiting international recruitment and reversing parts of the energy transition would place the region on a more closed path at the same time as it faces the practical need to attract capital and qualified workers.
The projected cost for households and jobs
The German Institute for Economic Research, known as DIW, has estimated that implementing the AfD’s wider economic programme could reduce average annual income in Saxony-Anhalt by about €1,600 per person. It has also projected the loss of roughly 10,000 jobs.
Those estimates describe potential consequences rather than an established outcome. They nevertheless give the debate a direct human and economic dimension: the issue is not only whether the state could balance its accounts, but whether households would see their incomes fall and employment opportunities shrink.
Economists have warned that abandoning the Bologna framework and pursuing economic isolation could have “catastrophic consequences” for science, the labour market and the region’s attractiveness to investors. Their broader concern is that the AfD’s programme could reverse gains made over the past two decades in European integration, economic modernisation, education and the recruitment of skilled workers.
If the party’s approach were implemented, the immediate test would be whether its promised tax cuts and spending commitments could be reconciled with the finances of states such as Saxony-Anhalt. The longer-term question is whether Germany’s regions can remain competitive while becoming less connected to European education, research, labour and investment networks.
Should voters judge the AfD’s economic promises primarily by their immediate political appeal or by the long-term costs identified by economists?
