GO
Loading...

Germany’s Roads Are its Secret Achilles Heel: Economist

Sean Gallup | Getty Images

Germany's road infrastructure is crippled by mishandling more common in a communist state than a free-market one, according to German economist Hans-Werner Sinn.

"The extent of the economic mismanagement on German roads, with obvious bottlenecks and poor coordination, contrasts starkly with the otherwise smoothly functioning economy that Germany is admired for around the world. It is more reminiscent of the communist economy than of a market-based economy," said Sin, the professor of economics and public finance at the University of Munich, who also heads the Ifo Institute.

(Read More: Euro Area Economic Situation Worsens: Ifo)

Sinn cited research by the Cologne Institute for Economic Research which showed that 21 percent of federal roads and 9 percent of highways require urgent repairs."Doing the full extent of the work needed to address the problem would double today's annual repair costs for years to come," he said.

In addition,the ADAC, the German automobile club, found there were almost 285,000 traffic jams in Germany in 2012. "The time spent in these jams totaled 4.9 billion hours…this represents an annual financial loss of 126 billion euros [$165 billion]," said Sinn.

He added that with little money to fix Germany's roads,tolls are the best option to cut congestion and generate revenue to repair highways.

Contact Europe News

  • CNBC NEWSLETTERS

    Get the best of CNBC in your inbox

    To learn more about how we use your information,
    please read our Privacy Policy.
    › Learn More

Europe Video

  • The FBI have stated that North Korea's government is responsible for the Sony attack. Neil Ashdown, deputy head of Asia analysis at IHS, weighs in, saying that it's difficult to "definitively attribute" a hacking attack to a particular group or state.

  • What were the main highlights of the EU Summit in Brussels? CNBC's Hadley Gamble gives you the lowdown.

  • Carnival Cruises earnings have beaten expectations in its fourth quarter, with lower fuel prices being a great help, says David Dingle, UK chairman of Carnival Cruises.