The federal and state governments agree on a realignment of regional economic aid.

The federal government, together with the states, has restructured regional funding. Key changes include simplified access to funding and stronger incentives for SMEs and securing skilled workers.

The federal and state governments have agreed on the restructuring of the regional funding program "Joint Task for the Improvement of Regional Economic Structures" (GRW) effective January 1st of this year. The regulations have... Federal Economic and Federal Ministry of Finance The program was systematically revised in cooperation with the federal states. Approximately €1,3 billion is available for the GRW (Joint Task for the Improvement of Regional Economic Structures) in 2026. The federal government and the states each contribute half of the funding. The states are responsible for selecting the GRW projects and administering the funding.

"With the restructuring of the GRW (Joint Task for the Improvement of Regional Economic Structures), we are making regional funding simpler, more effective and future-oriented – for strong municipalities, innovative companies and good jobs throughout Germany. Together with the federal states, we are ensuring that structurally weak regions receive better development opportunities, municipalities gain more scope for action and investments are targeted to where they create growth and good jobs," explains Federal Minister for Economic Affairs Katherina Reiche (CDU).

Important changes in commercial funding:

• Significantly simplified access to funding: In the future, basic eligibility for funding will be assessed based on a clear list of industries ("list of ineligible sectors" based on the classification of economic activities). The previously differentiated and, for individual industries, more difficult access to funding will be completely abolished.
• Stronger incentives for SMEs and securing skilled workers: The requirements for newly created jobs will be significantly simplified for small and medium-sized enterprises until the end of 2028. In regions with sharp population decline, apprenticeships will also be counted twice when calculating job quotas – initially for a period of three years.
• New focus on productivity: For the first time, companies that do not create additional jobs but increase their labor productivity by at least ten percent while maintaining at least the same level of employment or total gross wages can also be eligible for funding.
• More scope for action for municipalities: Until the end of 2028, land acquisition for the development of industrial and commercial areas can be partially subsidized for the first time – a key concern from the public consultation of the BMWE within the framework of the GRW reorganization.
• Consolidation and simplification of funding programs: The federal competition "Future Region" is being integrated into the GRW (Joint Task for the Improvement of Regional Economic Structures). This consolidates the funding landscape at the federal level and further strengthens the principle of "planning before investment".
• Strengthening innovation and testing: A new funding program for experimental and testing infrastructures is being introduced to specifically improve the foundations for innovation in structurally weak regions. In addition, the maximum funding amount for innovation clusters will be doubled from five to ten million euros, in compliance with state aid regulations.

GRW rulebookA detailed description of the GRW restructuring can be found here:
Information on the restructuring of the joint task "Improvement of the regional economic structure"

The new GRW coordination framework can be found here:
Coordination framework of the GRW from 1 January 2026Source: BMWE

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