Speaking at a trade union event in Hannover, Merz said that he would press the EU to "reduce unnecessary bureaucracy" and fight "to stop new bureaucracy".
Germany will push for the "simplification" of EU REACH regulations on chemical safety, Merz said, citing "long and complex procedures".
He also said industry should be given more time to adjust to EU plans for tariffs on carbon-intensive imports such as energy, steel and cement.
"It makes no sense to burden industry in Europe with higher costs," Merz said.
Germany's economy has stagnated over the past three years, with the country's storied manufacturers struggling with increasingly tough competition from Asia as well as high energy costs -- even before US President Donald Trump launched his tariff blitz.
Energy-intensive industries like chemicals have been hit particularly hard.
"Germany and its economy must remain industrial," Merz said.
"We need to come out of stagnation. It is as simple as that. We need growth in our economy once again."
German chemical plants are working at their lowest capacity since 1991, according to figures from the VCI chemicals lobby.
"Our sector has its back to the wall," VCI head Wolfgang Grosse Entrup told AFP. "It is one minute past midnight. We need to get this country back on track now."
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