Economy

Economy

ECONOMIC POTENTIAL

Germany has a social market economy characterized by a highly qualified labour force, a developed infrastructure, a large capital stock, a low level of corruption, and a high level of innovation.

 

Germany is the largest national economy in Europe, the fourth-largest by nominal GDP in the world. Since the age of industrialization and beyond, the industrial capitalism, the country has been a driver, innovator, and beneficiary of an ever more globalised economy. Germany is the world's second largest exporter with $1.408 trillion exported in 2011. Exports account for more than one-third of national output.

The service sector contributes around 70% of the total GDP, industry 29.1%, and agriculture 0.9%.

Most of the country's products are in engineering, especially in automobiles, machinery, metals, and chemical goods. Germany is the leading producer of wind turbines and solar power technology in the world. The largest annual international trade fairs and congresses are held in several German cities such as Hanover, Frankfurt, and Berlin. Combination of service-oriented manufacturing, links between industry and academia, international cooperation and SME contribute to the overall competitiveness of the economy of Germany.

Industry

INDUSTRY

Industry and construction accounted for 29% of gross domestic product in 2008, and employed 29.7% of the workforce. Germany excels in the production of automobiles, machinery, electrical equipment and chemicals.

With the manufacture of 5.2 million vehicles in 2009, Germany was the world’s fourth largest producer and largest exporter of automobiles. German automotive companies enjoy an extremely strong position in the so-called premium segment, with a combined world market share of about 90%.

Of the world's 500 largest stock market listed companies measured by revenue, the Fortune Global 500, 37 are headquartered in Germany. In 2010 the ten largest were Volkswagen, Allianz, E.ON, Daimler, Siemens, Metro, Deutsche Telekom, Munich Re, BASF, and BMW. Other large German companies include: Robert Bosch, ThyssenKrupp, and MAN (diversified industrials);

  • Bayer and Merck (pharmaceuticals);
  • Adidas and Puma (clothing and footwear); Commerzbank and Deutsche Bank (banking and finance);
  • Aldi, Lidl and Edeka (retail); SAP (computer software);
  • Infineon (semiconductors);
  • Henkel (household and personal consumer products);
  • Deutsche Post (logistics); and Hugo Boss (luxury goods).

Well-known global brands are Mercedes Benz, BMW, Adidas, Audi, Porsche, Volkswagen, Bayer, BASF, Bosch, Siemens, Lufthansa, SAP and Nivea.

Science

SCIENCE

Germany's achievements in the sciences have been significant, and research and development efforts form an integral part of the economy. The Nobel Prize has been awarded to 103 German laureates. For most of the 20th century, German laureates had more awards than those of any other nation, especially in the sciences (physics, chemistry, and physiology or medicine).

Research institutions in Germany include the Max Planck Society, the Helmholtz Association and the Fraunhofer Society. The Gottfried Wilhelm Leibniz Prize is granted to ten scientists and academics every year. With a maximum of €2.5 million per award it is one of highest endowed research prizes in the world.

Germany is one of the leading countries in developing and using green technologies.

Companies specializing in green technology have an estimated turnover of €200 billion.

Key sectors of Germany's green technology industry are power generation, sustainable mobility, material efficiency, energy efficiency, waste management and recycling, and sustainable water management.

Forecast

FORECAST

The German economy has proved relatively resilient in spite of the eurozone crisis. Germany escaped a recession in the first quarter of the year thanks to an increase in private consumption, which had offset a fall in exports.

The Bundesbank expects the economy to grow by 0.3% this year, down from an earlier forecast of 0.4%.

  2012 2013 2014 2015 2016 2017
GDP 0,8 0,3 1,6 1,7 1,6 1,5
Private consumption 0,6 0,8 1,2 1,2 1,2 1,2
Fixed investment -1,9 -0,4 4,0 3,9 3,2 2,8
Stockbuilding (% of GDP) 0,2 0,0 0,0 -0,1 -0,2 -0,4
Government consumption 1,4 0,9 0,7 -0,7 -0,7 -0,8
Exports of goods and services 4,3 0,5 3,3 4,8 5,0 4,6
Imports of goods and services 2,2 0,9 3,7 4,9 5,1 4,5
Consumer prices 2,1 1,5 1,6 1,7 1,7 1,7
Unemployment rate (level) 5,5 5,5 5,5 5,3 5,0 4,9
Current account balance (% of GDP) 7,1 7,1 6,6 6,3 6,3 6,4
Government budget (% of GDP) -0,1 0,0 0,0 0,0 0,0 0,0
Government debt (% of GDP) 79,1 78,9 78,6 78,8 79,0 79,1
TOP