Growing green tech market “major opportunity” for export nation Germany – report

Germany is well positioned to benefit from a growing global market of climate technologies like EVs, renewables and energy-efficient construction, said state-owned development bank KfW, citing a report produced with consultancy Deloitte. 

“Climate technologies are a dynamic growth market offering major opportunities for Germany and Europe,” said KfW CEO Stefan Wintels, presenting the report at a press conference on the sidelines of the UN climate change conference COP31 in Antalya, Turkey. He added it would bring a twofold benefit of furthering emissions reduction and boosting Germany’s economic competitiveness, but warned that competition is fierce and supply chains vulnerable. While Germany was in a good position, it had to become better at turning its pioneering research and development into growth, Wintels said. 

The report showed that China dominated the green tech market with 26 percent of global export value of emissions reduction goods in 2025, while Germany ranked second (10%). However, Deloitte’s head of global sustainable finance Hans-Jürgen Walter emphasised that the country could “not win the price war around standardised basic components.” Instead, the country’s strength lies in the export of high-quality system solutions. He warned that the high concentration of global production in a few countries, for example for battery cells and solar components, leaves supply chains vulnerable to shocks and geopolitical pressure, arguing against putting a lot of effort into building up domestic production capacity. “We should therefore only build up our own production capacities where real bottlenecks and dependencies are a threat,” Walter said.

With an average annual growth of 6.3 percent between 2017 and 2025, trade in climate tech is growing faster than trade in goods as a whole (4.7% average), said the report, with emissions reduction technologies growing fastest (8%). Investments in clean energy and electrification are expected to reach 2.2 trillion US dollars globally this year, almost twice the level of investments in oil, gas and coal (USD 1.2 trillion), said KfW.

German industry association BDI has said in the past that the country’s industrial success in the future depends on businesses doing well on green technologies such as modern power grids, wind energy, green hydrogen production, electric mobility, and heat pumps. While the government has introduced many policies that could support these sectors, the recent decision to weaken heating transition rules or efforts to reverse the de-facto combustion engine car ban at EU level risk putting up additional hurdles to clean tech expansion.

Asked in Antalya about the apparent discrepancy when it comes to EV regulation, German environment ministry state secretary Heike Henn countered that “current consumer behaviour is helping the technology to achieve a breakthrough, regardless of what the final rules at European level look like.”