Looking at some of the other replies to my comment (e.g. ElChapoDeChapo, Flyberius, CyborgMarx), I am not sure your comrades share that sentiment.
And I would agree if we were talking about "Germany", but "The Germans" is usually used to refer to the people of Germany.
I think it is important to clearly distinguish between a country's people and its government. Conflating the two only serves to mobilize ethnic hostilities.
As an object, "Germans" is usually some subset in the set of all Germans. "I met Germans in the park today." --> I met some people in the park, which are German. As a subject, this subset can be the entire set. "Germans are racist." --> Germans are generally racist.
"The Germans" is the subset of all Germans in some other set. "I met the Germans in the park today" --> If you are talking to a colleague, this likely means something like "I met all the Germans of our team in the park today."
As you point out, "the Germans" needs a context, i.e. which set are the Germans a subset of? Without context, that set is the set of all humans.
The question is then, which context does OP provide? And I think this is where our difference in how we understand comes from. I read the title first, so I read it as "Germans (as a subset of all humans) are racist". But, given the posted image, you may also read it as "German officials (as a subset of all officials) are racist", which is probably how you read it. I still wouldn't agree with that message, but I wouldn't reject it quite as strongly as the first one.
I think both readings of the title are valid, and this ambiguity could be avoided by using "Germany" or "German officials"
Another point: I agree that Germany has an issue with racism. But how is an ethnostate constitutionally supported? The constitution straight up bans racism in article 3: "No one may be disadvantaged or favored because of their gender, ancestry, race, language, homeland and origin, faith, religious or political opinions."