Economic Overview Germany - September 2011 (Germany Trade & Invest)

8/3/2019 Economic Overview Germany - September 2011 (Germany Trade & Invest)

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BusinessLocationGermany

Economic Overview Germany:Market, Productivity, Innovation

Issue 2011/2012


2/15Economic Overview Germany www.gtai.com

Basic Data

Area: 357,104 sq. km

Population (m.): 82

Number of companies

3.72 million, 99.6% SMEs

Total turnover of all companies*

EUR 5.36 trillion,38.0% SME turnover

Economic Development

GDP (nominal in EUR billion)

2010: 2,477; 2009: 2,397;2008: 2,481

Per capita GDP (EUR)

2010: 30,564; 2009: 29,278;2008: 30,214

Inflation rate2010: 1.1%; 2009: 0.2%; 2008:2.8%

Unemployment rate

2010: 7.3%; 2009: 7.5%; 2008:7.3%

* Most current data 2008 Financial Services, Renting,Business Services 27.3%

Production-basedIndustries 25.0%

Commerce, Catering Industryand Communications 15.4%

Others 32.3%

GDP Formation 2010 (in percent)

Foreign Trade

Foreign trade

(EUR bn)

2008 % 2009 % 2010 %

ExportsImportsBalance

984.1805.8

+178.3

+2.9+4.3

803.3664.6

+138.7

-18.4-17.5

959.5806.2

+153.4

+19.4+21.3

Germanys trade

relations with

EU (EUR bn)

Exports to EUImports from EUBalance

621.3531.5+89.8

+0.5+5.1

489.1441.3+47.8

-21.3-17.0

557.3515.2+42.1

+13.9+16.7

Export goods

(% of total exports SITC)

2010: machinery 18.1; motor vehicles and parts 15.9; chemical goods 15.7;electronic goods 9.5; foodstuffs 4.2; others 36.6

Import goods(% of total imports SITC)2010: chemical goods 12.7; machinery 12.0; electronic goods 11.0;crude oil 7.5; motor vehicles and parts 7.4; foodstuffs 5.7; others 43.7

Sources: Federal Statistical Office, Federal Ministry of Finance, ifm Bonn 2011

GDP Growth

6

4

2

0

-2

-4

-62008 2009 2010

(real annual change in percent)

1.3

-4.7

3.6



Foreign Direct Investment

Paving the Way forForeign DirectInvestment

First Choice Business Location

A recent study conducted by theAmerican Chamber of Commercehighlights the positive regard inwhich the German business envi-ronment is held by US companies.

Invited to indicate their main me-dium-term investment focus withinthe EU, 60 percent of participatingAmerican companies named Ger-many as their first choice; followedby Eastern Europe (28 percent), andthe UK (18 percent) respectively.

Ernst & Youngs European Attrac-tiveness Survey 2011 confirmsGermanys reputation as one of themost attractive business locations

in the world. International decisionmakers ranked Germany first withinEurope, and fifth worldwide in the

most attractive business locationcategory.

Free and Open Markets

Germany has a welcoming attitudetowards foreign direct investment(FDI). The German market is openfor investment in practically allindustry sectors, and businessactivities are free from regulations

restricting day-to-day business.German law makes no distinctionbetween Germans and foreign nati-onals regarding investments or theestablishment of companies. Thelegal framework for FDI in Germanyfavors the principle of freedom offoreign trade and payment. Thereare no restrictions or barriers tocapital transactions or currencytransfers, real estate purchases,repatriation of profits, or accessto foreign exchanges.

Supporting Investment Projects

Incentives in Germany are designedto meet the immediate capital needsof investors. Early stage investmentfinancing provides funding at thebeginning of the new investmentproject. These incentives, mostlyprovided as cash grants, are impor-tant as they guarantee liquidity ata stage in the investment process

when investor capital requirementsare typically high. Later stage invest-ment incentives are made availablein the form of a raft of programscreated to support putting togethera workforce in Germany (e.g. throughwage subsidies) and provide gene-rous R&D project assistance. Incen-tives in Germany are available to allinvestors regardless of investorcountry of provenance. Funding tothe tune of EUR 26.3 billion has beenfreed up by the EU (co-financed using

means obtained from German nati-onal and federal budgets) through2013. As well as this, Germany and itsindividual federal states also maketheir own incentives funds availableto prospective investors.

For more incentives information,please visit our website:www.gtai.com/incentives

Global FDI Magnet

According to the United NationsConference on Trade and Develop-ment (UNCTAD), Germany ranksamong the worlds leading countriesfor foreign direct investments withmore than EUR 509 billion in inwardFDI stocks in 2010. This representsa growth of 33 percent from 2005to 2010.

According to official Bundesbank(German Central Bank) statisticsfor 2009, 77 percent of all FDIstocks in Germany originate fromwithin the EU-27; with a furthernine percent derived from the re-maining European non-EU coun-tries. Investments from outsidethe EU continue to grow. NorthAmerica accounts for eight per-cent of FDI stock, while Asia holdsa five percent share.

AmCham Business Barometer 2011

American business executives highlighted the following factors as the toplocation advantages that distinguish Germany from its competitors.

Economic strength: diversified mixture of businesses

Infrastructure: excellent nationwide infrastructure

Framework conditions: governmental promotion of forward-thinkingindustries (e.g. solar and biotech)

Human capital: highly qualified workforce, skilled talent pool

Source: American Chamber of Commerce Germany, Boston Consulting Group 2011



Foreign Direct Investment

Foreign DirectInvestment Projects

Every year more and more compa-nies discover Germany as a secureand rewarding investment location.More than 55,000 foreign companiesare already operating in Germany,providing employment to aroundthree million people proof positive

of Germanys attractiveness as aninternational business location.

Between 2003 and 2010, fDi Marketsrecorded a total of 3,925 investmentprojects from 2,929 foreign compa-nies. With 776 projects, 2010 pro-ved to be the most successful yearon record with Germany placingfourth internationally in terms ofFDI projects attracted.

The most important countries as

sources for new investment projectsare the USA (27 percent of all invest-ment projects), UK (nine percent),and Switzerland (seven percent) res-pectively. In 2009, China emerged asa major source of investments, withthe number of Chinese investmentprojects into Germany more thandoubling within just one year. Thishigh level was reached again in 2010,making Germany the worlds num-ber one location for Chinese green-field investments.

Diverse Industry Opportunities

According to fDi markets, foreigncompanies invested in 39 differentsectors underlining Germanyshighly diversified economy. Mostnew investment projects were rea-lized in the ICT & software industry(18 percent of new projects). Busi-ness and financial services as wellas automotive and industrial machi-nery & equipment were close behind

each with 15 percent of all projects.

Most new projects open sales andmarketing & support offices. Almostone in five investment projects ismanufacturing-site located makingthis the second most importantbusiness activity in Germany.

Germany Trade & Invest's industryexperts will assist you to realizeyour investment project in Germany.Please contact [email protected] more information.

ICT & Software 18%

Business & FinancialServices 15%

Automotive, IndustrialMachinery & Equipment 15%

Chemicals, Plastics,Paper 8%

Electronics &Semiconductors 7%

Consumer Goods(incl. Food & Beverages) 7%

Textiles 6%

Health Care, Pharma,Biotechnology6%

Transportation, Storage &Logistics 5%

Energy, Minerals, Metals 4%

Hotel, Tourism, Entertainment 3% Renewable Energy 2%

Other Sectors 4%

FDI Project Share in Germany by Sector 2003-2010

(as percent of total FDI projects)

Source: fDi Markets 2011

Sales, Marketing & Support

*Shared Service Center/Buisness Process Outsourcing/Contact CenterSource: fDi Markets 2011

0 5 10 15 20 25 30 35 40

Manufacturing

Business Services

Logistics, Distribution & Transportation

Headquarters

R&D

ICT & Internet Infrastructure

SSC/BPO/CC*

Education & Training

Other Activities

35%

17%

15%

6%

6%

2%

1%

1%

1%

17%

FDI Project Share in Germany by Business Activity 2003-2010

(as percent of total FDI projects)


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Europes Economic Hub

Europes Largest MarketGermany is the largest market inEurope. It constitutes 20 percent ofEuropean GDP, and is home to 16percent of the total European Union(EU) population. The German econo-my is both highly industrialized anddiversified; with equal focus placed

on services and production.

Quick RecoveryGermany quickly recovered fromthe economic slump of 2009. Witha GDP increase of 3.6 percent, theeconomy experienced a strong growthdynamic in 2010. In the second quar-ter of 2010 alone, Germanys GDPexpanded by 2.2 percent the stron-gest quarter-on-quarter growth sincereunification in 1990. This positive

development is reflected in all rel-evant economic key data. The trendis expected to continue in 2011, withthe German government forecastinga GDP growth rate of 2.6 percent.

Global PlayerGermanys products continue to beexport hits worldwide. Since 2003,exports have grown by more than fivepercent on average each year. In fact,Germany overtook the United States,becoming the world export leader

for six years in succession until 2008.German trade figures enjoyed a briskrecovery from the global recession,increasing by around 20 percent in2010. Imports and exports in 2010amounted to EUR 806 billion andEUR 960 billion respectively.

German-produced goods from thechemical, automotive, and machin-ery & equipment industries are inparticularly high demand worldwide.

Germanys main trading partnersnumber European countries suchas France, UK, Italy, and the Nether-lands as well as international mar-

kets including the United States,China, Russia, and Japan. Seventy-one percent of all exports are ex-ported to European countries, ofwhich 15 percent go to eastern Euro-pean countries. In 2010, the numbertwo region for German exports wasAsia; receiving approximately 15percent of all goods from Germany,followed by the Americas at approx-imately 10 percent.

Manufacturing Location GermanyGerman companies represent morethan nine percent of European man-ufacturing companies and generate27 percent of total EU turnover in thesector. In fact, the manufacturingsector represents nearly one fifthof Germanys value added oneof the highest shares in Europe. In-creasingly more foreign companiesare placing their faith in Germany as

a vital production site location, andare benefiting from the countrysexcellent business framework andsuperior productivity rates.

SMEs: GermanysEconomic BackboneExports are driven by Germanysbackbone of highly innovative smalland medium-sized enterprises(SMEs). These constitute 99.6 percentof all companies, employing 79.5percent of all employees in Germany.Many of these SMEs are world mar-ket leaders in their respective nichesegments. Together with interna-

tionally leading large companies including Bayer, BASF, Daimler,Volkswagen, and Siemens to namebut a few they make up Germanysmanufacturing industrial base.

Economic Overview Germany: Market

GDP

(in EUR

billion)

Share of

Total GDP

(EU-27)

Population

(in million)

Share of

Total

Population

(EU-27)

Germany 2,477 20% 82 16%

France 1,933 16% 65 13%

UK 1,697 14% 62 12%

Spain 1,063 9% 46 9%

Netherlands 588 5% 17 3%

Poland 354 3% 38 8%

CzechRep. 145 1% 11 2%SlovakRep. 66 1% 5 1%USA 10,957 309

Japan 4,122 128

EU-27 12,284 501

Eurozone 9,170 331

Share of Total GDP and Population in the European Union 2010

Note: Czech Rep. GDP data are forecasts

Source: Eurostat, US Census Bureau, Japanese Statistics Bureau 2011

Economic Overview Germany www.gtai.com


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Closer to Market with

First Class Infrastructure

Europes Global Logistics HubWith state-of-the-art transporta-tion networks by road, rail, sea, andinland waterways as well as adense network of both national andinternational airports Germanyprovides easy access to domesticand international markets. Littlewonder that Germany is a globallogistics hub. More goods passthrough Germany than through anyother country in Europe. Its approx-imately one quarter share of theEuropean logistics market (EU-27,Norway and Switzerland) reflectsGermanys role as the major pla-yer in the continents economy.

World Class Transport

InfrastructureGermanys infrastructure excel-lence is confirmed by a number ofrecent studies including the SwissIMDs World Competitiveness Year-book and various investor surveysconducted by institutions includingUNCTAD and Ernst & Young. The2011-2012 Global CompetitivenessReport of the World Economic Fo-rum (WEF) ranked Germany firstin Europe and second worldwide

for infrastructure; singling outGermanys extensive and efficientinfrastructure for highly efficienttransportation of goods and passen-gers for special praise. Accumulatedin this score for Germany are highmarks for the quality of roads andair transport, excellent railroadsand port infrastructure, as wellas its communications and energyinfrastructure.

Economic Overview Germany: Market

World Class NetworkInfrastructureAmong the highlights of the coun-trys network infrastructure areEuropes second largest portmeasured in container port traffic(Hamburg), Europes largest portcontainer terminal (Bremerhaven)and over 250 inland ports. Germanyhas a dense network of airports (ofwhich 22 are international airports).Among them, Frankfurt is the worlds

seventh and ninth largest airportin terms of cargo and passengervolume respectively. The countryshighway system has one of the high-est highway kilometer density levelsin Europe, its 37,900 km of railwaytrack being almost enough to circlethe globe. Germanys high-speedrailway network, with speeds of upto 300 km/h, is the fourth largest inthe world.

Logistics GiantsNot only is Germanys logistics infra-structure among the best, its compa-nies are also global logistics leaders.In fact, the worlds largest logisticsservices provider is a German com-pany Deutsche Post DHL. DeutscheBahn operates Europes largest railnetwork and Lufthansa Cargo isone of the worlds leading global airfreight companies. Annual revenuesof over EUR 200 billion in 2010 makeGermany Europes logistics leader.

No other EU country comes close toGermanys market size.

Germany is our strategic focal point, a countrythere is no way around in our industry. Germanyis the largest market in Europe, which creates the

greatest advantages for our company. Investinghere was an absolute must.Sun Shubao, General Manager, Haier Group Europe and Germany

Source: World Economic Forum 2010

Rank Countr y

1 Hong Kong

2 Germany3 Singapore

4 France

5 Switzerland

6 UK

7 Netherlands

8 UAE

9 South Korea

10 Denmark

Quality of Infrastructure

Source: WEF 2011

Bringing East and West TogetherIn the north, Germanys seaportsare an important conduit for tradewith the UK, Scandinavia, and theBaltic states. In the west, an exten-sive network of roads, rail links andinland waterways feeds into Franceand the Benelux countries. To thesouth, Germany has strong com-mercial ties with Switzerland andAustria and direct road, rail andwater links with the Balkan states.

Turning eastwards, Germanys bor-ders with Poland and the Czech Re-public also bring the Slovak Republicand Hungary within easy reach andmake the more distant markets inTurkey and Russia readily accessible.



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Economic Overview Germany: Productivity

IncreasingCompetitiveness

High ProductivityMeasured in unit labor costs, Ger-many experienced a major increasein productivity the past decade. Inmarked contrast to other Europeancountries which have experiencedan overall increase in unit laborcosts, Germanys unit labor costsdecreased by a yearly average of 0.3percent for the period 2005 to 2010.This made the economy more com-petitive particularly manufacturing.

Stable Labor CostsAt the same time, the labor cost gapbetween Germany and its easternEuropean neighbors has been signifi-cantly reduced. In fact, Germany hasgained the labor-cost edge in recent

years. Since 2000, wages have risenin most European countries (EU-27),with the growth rate averaging 3.7percent. While some countries particularly those in eastern Europeexperienced a rise of more thanseven percent, Germany recordedthe lowest labor cost growth withinthe EU at just 1.6 percent. This hasbeen another decisive argument infavor of Germany as a premium busi-ness location.

Excellent Production StandardsGermanys high productivity is alsoclosely linked to its excellent pro-duction process standards. This hasbeen confirmed by a study of inter-national executives conducted bythe World Economic Forum. Accord-ing to the study findings, Germanyis seen as a country where the bestand most efficient process technol-ogy is applied.

Japan

1=labor-intensive methods or previous generations of process technology7=the worlds best and most efficient process technology

Source: World Economic Forum 2011

0 1 2 3 4 5 6 7

Germany

Netherlands

USA

France

UK

Czech Rep.

Spain

Slovak Rep.

Poland

6.5

6.3

6.0

5.6

5.6

5.5

4.6

4.5

4.4

4.0

Assessment of Sophistication of Production Process 2010

China 4.0

Annual average growth expresssed as percentage of industry, construction and ser vices.Source: Eurostat 2011

European Labor Cost Growth 2001-2010

0% 5% 10%

1.6%

2.1%

3.4%

3.6%

4.1%

6.3%

6.8%

8.3%

7.7%

Germany

France

Netherlands

Spain

UK

Poland

Czech Rep.

Slovak Rep.

Hungary

Europe is a growing market for our light-curingadhesives. Due to the highly qualified workers andefficient cost structure, Germany was the clearchoice for the expansion of our production andR&D activities.A.Gregory Bachmann, President, DYMAX Corporation



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Highly Skilled WorkforceGermanys excellent workforce isdecisive to the countrys high pro-ductivity rates. It comprises over40 million people making it thelargest pool of ready labor in theEU. Germanys world-class educa-tion system ensures that the high-est standards are always met. Morethan 80 percent of the German work-force has received formal vocationaltraining or is in possession of anacademic degree.

Dual Education SystemGermany provides direct access toa highly qualified and flexible laborpool. For vocational training thecountry developed the dual educa-tion system unique in combiningthe benefits of classroom-based andon-the-job training over a period oftwo to three years which is specifi-

cally geared to meet industry needs.There are currently around 350occupations recognized by the sys-tem. The German Chambers of In-dustry and Commerce (IHKs) ensurethat exacting standards are rigidlyadhered to, guaranteeing the qualityof training provided across Germany.

Engineering ExcellenceAccording to the OECD, Germanyhas an excellent standard in higher

education. In 2010, some 443,000students at more than 400 uni-versities embarked on a course ofacademic study. Technical fields ofstudy experienced an undergraduateenrollment level increase of morethan eight percent. Germanys shareof university students in the sciences,mathematics, computer sciences,and engineering is the second high-est in the EU, with 31 percent of allstudents. German universities haveintroduced masters and bachelor

degrees for improved internationalacceptance and comparison.

In addition, the country can be proudof one of the highest rates of gradu-ates with a doctoral degree. With 312PhD graduates per million inhabit-ants, it ranks second in a comparisonof OECD countries.

Outstanding ReputationGerman labor flexibility is reflectedin higher than average employeemotivation levels exceeding thoseof most leading industrialized nations.

In fact, according to the IMD WorldCompetitiveness Yearbook, German

Economic Overview Germany: Productivity

employee motivation levels aregreater than those of their coun-terparts in the US, China, Poland,France, and the UK. A direct corol-lary of this is the fact that Germanswork more than their internationalpeers (41.8 hours per week) and loseless days per annum to strike actionthan other European nations (sig-nificantly below the EU-27 averageaccording to Eurofound).

Workforce in Germany by Level of Professional Education 2010(percent of total workforce)

Source: Federal Statistical Office 2011

Skilled Craftsmen(dual education systemapprentices) 55%

Vocational CollegeGraduates & Technicians(master craftsmen) 9%

Unskilled 18%University Graduates 18%

10=highest motivation levelNote: IMD WCY Executive Opinion Survey based on an index from 0 to 10Source: IMD World Competitiveness Yearbook 2011

Worker Motivation in Companies 2011

Denmark

0 1 2 3 4 5 6 7 8

Germany

Netherlands

Japan

USA

Czech Rep.

China

UK

HungaryPoland

7.24

7.14

6.88

6.47

6.05

5.96

5.70

5.245.00

Spain

Slovak Rep.

4.95

4.82

France 4.42

8.09



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High Innovation Rate

Innovation Leader GermanyIn Germany, enormous sums areinvested in the development of newtechnologies and innovations. Today,total R&D expenditures of EUR66.7 billion (2009) make GermanyEuropes largest research location.Since 2005, R&D expenditures have

steadily increased at a compoundannual growth rate of 4.6 percent.

R&D is considered to be among themost important areas for the devel-opment of the German economy. In-dustry in particular has significantlyincreased its R&D expenditures inrecent years. The European Com-mission accordingly expects Germanyto reach its ambitious 2020 R&Dtarget of three percent of GDP in

the coming years (Innovation UnionCompetiti veness Report 2011).

R&D Excellence in German RegionsThe large amounts Germany investsin fast-developing technologiesis visible at a regional level. Theindividual federal state researchbudgets correspond with those ofother European countries. For ex-ample, Bavaria significantly exceedsRussias R&D investments, whileNorth Rhine-Westphalia invests

more than its western neighbor, theNetherlands.

One of the most R&D intensiveregions with the highest researchexpenditures in Europe can befound in Germany. The regionsaround Stuttgart, Karlsruhe, Tbin-gen, and Darmstadt are unique inEurope, benefiting from high R&Dbudgets in strong industries andtheir immediate environs. Eight

percent of the total R&D budget inEurope is spent in this geographicalcluster alone.

Value Added ThroughInnovative TechnologiesA 2011 study carried out by theGerman Institute of EconomicResearch (DIW) found that no otherindustrialized country produces alarger share of gross value addedin research-intensive manufactur-ing industries than Germany. Theshare of total value creation inresearch-intensive industries in

Germany exceeds Japan and USlevels and is more than double theshare of France, UK, and Italy.

High-Tech Products Madein GermanyGerman companies are global lead-ers in the development of new tech-nologies. Standing for high qualityand innovation, the Made in Germanybrand has been a seal of quality forover a century. In 2009, Germany ex-ported high-tech goods to the valueof EUR 102 billion making it the tophigh-tech goods exporter in Europe

and second worldwide.

Economic Overview Germany: Innovation

R&D Expenditure by Federal State Equivalent Country 2009

NORTH SEABALTIC SEA

CZECH REPUBLIC

POLAND

THE NETHERLANDS

BELGIUM

FRANCE

LUXEM-

BOURG

Source: Eurostat, Federal Statistical Office 2011Cartography:roccomontoyaistockphoto.c

om

Baden-Wrttemberg

Spain + Portugal

Bavaria Russia

Saarland Croatia

Rheinland-Pfalz

Poland

North Rhine-Westphalia

Netherlands

Hessen Belgium

Saxony Portugal

Thuringia Hungary

Saxony-Anhalt Slovenia

Niedersachsen Norway

Mecklenburg-Vorpommern

Romania

Schleswig-Holstein

Slovenia + Slovak Rep.

Hamburg Czech Rep.

Bremen Luxembourg

Berlin Turkey

Brandenburg Bulgaria +

Romania

Germany

France

UK

EUR 42.1 bn

EUR 29.3 bn

EUR 67.7 bn

DENMARK



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Intellectual property rights enjoy ahigh level of protection in Germany.For technical and commercial in-novations, property rights can beregistered in the form of patents,utility models, trademarks, anddesigns. The same conditions applyto foreigners as they do German

nationals when registering propertyrights. These are just some reasonswhy Taylor Wessing ranked Germanyfirst in its Global Intellectual Prop-erty Index 2011.

Profiting from Innovation ClustersThe German R&D landscape is bestexemplified by close cooperationbetween the worlds of science andindustry. Germanys publicly fundedresearch bodies provide an interna-tionally unique selling point. The

applied research institutes of theFraunhofer Society and LeibnizAssociation provide companies

particularly SMEs with unparal-leled access to world-class re-search. With about 60 institutes andmore than 13,000 employees, theFraunhofer-Gesellschaft utilizesEUR 1.6 billion in research fundingevery year. The Leibniz Associationhas established a network of more

than 80 research institutions with al-most 12,000 employees. Some of theworlds most renowned fundamentalresearch institutes are also locatedin Germany. The Max Planck Societyand the Helmholtz Association allowcompanies to outsource costlyresearch activities. This eases theaccess of developing new productsand decreases research and de-velopment costs. Numerous spin-offs underline the ability of Germanresearch organizations to capitalize

on technology.

Public R&D Support:Germanys High-Tech StrategyAn unprecedented campaign to fosterthe advancement of new technolo-gies has been launched by the Ger-man government. Annual R&D fund-ing of approximately EUR 4 billionhas been set aside to develop cuttingedge technologies. R&D projectscan accordingly count on numerousforms of financial support. Interest-reduced loans and special partner-ship programs complete Germanyspublic R&D project support.

World Class Know-HowWhile Germany is home to the larg-est population of researchers inEurope (20 percent of all EU scien-tists live and work in Germany),German scientists work on proj-ects all over the world. For ex-ample, research results within the

Max Planck Society are achievedthrough fruitful partnershipswith more than 6,500 partners inresearch institutions across 123countries. Cooperation projectsbetween companies and academicresearch institutes provide an ef-ficient way to close knowledge gaps.Scientists can be easily integratedinto the company team of develop-ers and researchers and, increas-ingly, institutes provide for the

necessary laboratory facilities.

Europes Patent LeaderWith over 12,000 patents grantedat the European Patent Office in2010, Germanys share of patents isalmost twice that of France and theUK combined. This shows the com-mercial viability of innovations madein Germany. The country is also theleading European nation in triadicpatents (patents registered at thethree major global patent offices:

the European Patent Office, theUnited States Patent and TrademarkOffice, and the Japan Patent Office).

Economic Overview Germany: Innovation

Source: Eurostat 2011

Germany 20%

France 18%

UK 15%

Portugal 3%

Sweden 3%

Poland 4%

Italy 6%

Spain 8%

Others (18 EU countries) 20%

Netherlands 3%

National Share of Researchers in EU-27 2009

As a global company, Alcatel-Lucent relies onGermanys excellent R&D landscape. A cultureof efficiency, creativity, and entrepreneurshipcreates the ideal environment for us to innovate.Alf Henryk Wulf, Chairman of the Boar d, Alcatel-Lucent Deutschland AG



11/15

Ireland

UK

Russia

FinlandSweden

Norway

France

Spain

Portugal

Italy

Poland

GERMANY

Malta

Greece

Denmark

Czech Republic

Austria

SwitzerlandRomania

Netherlands

Belarus

Ukraine

Turkey

SerbiaBulgaria

Lithuania

Latvia

Estonia

Bosnia-Herzegovina

SlovakRepublic

Hungary

RU

Moldova

Macedonia

Albania

Croatia

Slovenia

Montenegro

Dublin

London

Lisbon

Madrid

Paris

Luxembourg

Berlin

Belgium

Brussels

Amsterdam

Copenhagen

Oslo

Stockholm

Helsinki

Moscow

Minsk

Tallin

Riga

Vilnius

Warsaw

Kiev

Chisinau

Bucharest

Sofia

Ankara

Athens

Tirana

Skopje

Belgrade

Rome

Valletta

Bern

Sarajevo

ZagrebLjubljana

Vienna

Budapest

Bratislava

Prague

Podgorica

1,

5h>

3hb

yp

lane

>

Cartography:www.fotolia.deAntnioDuarte

Sour

ce:GermanyTrade&Invest2011

Edinburgh

Cardiff

Germany: At the Crossroads of Europe

Situated at the market crossroads of Europe, Germanys optimal geographiclocation is beyond question: over half of the EU population lives within 500kilometers of Germanys borders; more goods pass through Germany thanany other European country; and almost all of Europe is reachable withinthree hours by air or 24 hours by road.

KosovoPristina



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Industrial Focus ofNetworks of Competence

Biotechnology Micro-Nano-Opto Production and Processing Transport and Mobility Health and Medicine Energy and the Environment New Materials and Chemicals Information and Communication Aerospace

Source:KompetenznetzeDeutschland2011

Greifswald

Berlin

Dresden

ChemnitzJena

Cham

Munich

Bayreuth

Erlangen

Gerbrunn

Hanau

Darmstadt

Freising

Regensburg

MartinsriedGilching

Weling

Augsburg

Gppingen

Oberkochen

Neumarkt

Freiburg

Stuttgart

Fellbach

Heidelberg

Karlsruhe

SaarbrckenKaiserslautern

Wrstadt

Wiesbaden

Bonn

Nuremberg

Kassel

GttingenPaderborn

Bielefeld

Hanover

Gatersleben

Braunschweig

Vechta

Achim

Oldenburg

Bremerhaven Stade Hamburg

Lbeck

Aachen

Remscheid

DsseldorfLdenscheid

Wuppertal

UnnaDortmund

Duisburg Velbert

Potsdam

Networks of Competence in Germany

The Kompetenznetze Deutschland(Competence Network Germany) initiativeof the Federal Ministry of Economics and Technology brings together the best-performing innovation clusters and networks in Germany. These are set upaccording to nine industry-specific category groups spread across Germany.The network helps promote international cooperation and international clusterknowledge transfer.



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Our Investment Project Consultancy Services

Germany Trade &Invest Helps You

Germany Trade & Invests teams ofindustry experts will assist you insetting up your operations in Ger-many. We support your project man-agement activities from the earlieststages of your expansion strategy.

We provide you with all of the indus-try information you need coveringeverything from key markets andrelated supply and application sec-tors to the R&D landscape. Foreigncompanies profit from our rich ex-

perience in identifying the businesslocations which best meet their spe-cific investment criteria. We helpturn your requirements into concreteinvestment site proposals; providingconsulting services to ensure youmake the right location decision. Wecoordinate site visits, meetings withpotential partners, universities, andother institutes active in the industry.

Our team of consultants is at handto provide you with the relevantbackground information on Germa-nys tax and legal system, industryregulations, and the domestic labormarket. Germany Trade & Invests

experts help you create the appro-priate financial package for your in-vestment and put you in contact withsuitable financial partners. Incen-tives specialists provide you withdetailed information about availableincentives, support you with the ap-plication process, and arrange con-tacts with local economic develop-ment corporations.

All of our investor-related servicesare treated with the utmost confiden-tiality and provided free of charge.

Project Management Assistance

Coordination andsupport of nego-tiations with localauthorities

Joint projectmanagement withregional develop-ment agency

Project partneridentificationand contact

Market entrystrategy support

Business oppor-tunity analysis andmarket research

Location Consulting /Site Evaluation

Final site

decision support

Site visit

organization

Site preselectionCost factor

analysis

Identification of

project-specificlocation factors

Accompanyingincentives applicationand establishmentformalities

Administrativeaffairs support

Organization ofmeetings withlegal advisors andfinancial partners

Project-relatedfinancing and incen-tives consultancy

Identification of re-levant tax and legalissues

Support Services

Decision & InvestmentStrategy Evaluation


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Contact

Imprint

Publisher

Germany Trade and InvestGesellschaft fr Auenwirtschaftund Standortmarketing mbH

Friedrichstrae 6010117 BerlinGermany

T. +49 (0)30 200 099-555

F. +49 (0)30 200 [email protected]

Chief Executives

Dr. Jrgen Friedrich, Michael Pfeiffer

Authors

Thomas Bozoyan, Market Intelligence GermanyGermany Trade & Invest, [email protected]. Hans-Peter Hssen, Market Intelligence GermanyGermany Trade & Invest, [email protected]

Marc Lehnfeld, Market Intelligence GermanyGermany Trade & Invest, [email protected]

Editor

William MacDougall, Germany Trade & Invest

Layout

Germany Trade & Invest

Print

CDS Chudeck-Druck-Service, Bornheim-Sechtem

Support

Promoted by the Federal Ministry of Economics and Technology and the FederalGovernment Commissioner for the New Federal States in accordance with aGerman Parliament resolution.

NotesGermany Trade & Invest, September 2011All market data provided is based on the most current market informationavailable at the time of publication. Germany Trade & Invest accepts no liabilityfor the actuality, accuracy, or completeness of the information provided.

Order Number

14783


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Photo:istockphoto.com

ClaudiaDewald

Germany Trade & Invest

Friedrichstrae 6010117 BerlinGermany

T. +49 (0)30 200 099-555F. +49 (0)30 200 [email protected]

About Us

Germany Trade & Invest is the foreign trade and inward investment

agency of the Federal Republic of Germany. The organization

advises and supports foreign companies seeking to expand into

the German market, and assists companies established in

Germany looking to enter foreign markets.

All inquiries relating to Germany as a business location are

treated confidentially. All investment services and related

publications are free of charge.

Promoted by the Federal Ministry of Economics and Technologyand the Federal Government Commissioner for the New FederalStates in accordance with a German Parliament resolution.

www.gtai.com

Economic Overview Germany - September 2011 (Germany Trade & Invest)

Documents