Germany is Europe’s largest economy. It is an affluent and technologically powerful economy that produces almost one fifth of the EU’s total GDP. With a population of over 80 million Germany represents the largest single market in the EU, however, the German marketplace offers more than just the people inside its borders. As the world’s largest importer and second largest exporter, the country’s significance is undeniable. A large volume of global trade takes place in Germany at some of the biggest trade shows in the world including CeBit, Medica, Hannover Fair, Automechanika and the IBT Tourism Show.
Economy
In 2007, the economy posted growth of 2.5 per cent, despite a three percentage point rise in VAT at the beginning of the year. Against the background of the global financial crisis, the German economy began to slow. In 2008, GDP expanded by 1.3 per cent. The economy is expected to contract sharply in 2009 with GDP falling by 5.3 per cent; recovery is expected in 2011.
Investment Climate
The German government actively encourages foreign investment and the law states that investors will receive national treatment. Despite some remaining government regulation, the German economy continues to be strong and internationally competitive. Germany is an export giant, despite relatively high production costs, and is well placed to take advantage of the rapidly growing central European countries. The country has an open investment regime and the current government is committed to encouraging foreign investment. They have addressed some of the country’s remaining structural issues with important tax, social security and financial sector reforms.
Germany offers numerous incentives for foreign investors. There is a variety of programmes available, designed to fit the needs of diverse economic activities at different stages of the investment process. Support ranges from cash incentives to labour-related, and incentives for research & development.
Opportunities
Germany is a sophisticated, mature and highly competitive market. The population has a high standard of living, with GDP per capita among the highest in the EU. British companies sell a huge range of products and services to the country and there are opportunities in most sectors. Particular export successes include:
• Vehicles/components
• Petroleum and gas
• Healthcare
• Aerospace
• Chemicals
• Creative industries
UK Trading Relationship
Germany is the UK’s second largest global market and its largest European export market. In 2008, British exports to Germany totalled £28.4 billion. On the import side the UK took German goods worth £44.4 billion in 2008.
KEY FACTS
Official Name: Federal Republic of Germany
Capital: BerlinArea: 357,027 sq km
Population: 82.5m (UN, 2008)
Major language: German
GDP (current): US$3,317.37bn (World Bank, 2007)
GDP growth: 2.5% (World Bank, 2007)
GNI per capita: US$38,990 (World Bank, 2007)
Inflation (consumer prices): 2.8% (2008 est.)
Labour force: 43.62m (2008 est.)
Unemployment: 7.9% (2008 est.)
Monetary unit: 1 euro = 100 cents
Exports to UK: £44,476.42m (HMRC 2008)
Imports from UK: £28,429.58m (HMRC 2008)
Main Industries
Among the world’s largest and most technologically advanced producers of iron, steel, coal, cement, chemicals, machinery, vehicles, machine tools, electronics, food and beverages, shipbuilding, textiles.
Main Exports
Machinery, vehicles, chemicals, metals and manufactures, foodstuffs, textiles.
Main Imports
Machinery, vehicles, chemicals, foodstuffs, textiles, metals.
CONTACTS
Kingsgate House66-74 Victoria Street
London, SW1E 6SW
Tel: 020 7215 8000
Web: www.uktradeinvest.gov.uk
British Embassy
UKTI Section
Wilhelmstrasse 70
D-10117 Berlin
Tel: 00 49 30 204 57-0
Email:handelsabteilung.berlin@fco.gov.uk
Web: ukingermany.fco.gov.uk/en
Embassy of the Federal Republic of Germany
23 Belgrave Square
London SW1X 8PZ
Tel: 020 7824 1300
Web: www.london.diplo.de
