Germany's affluent and technologically powerful economy - the fifth largest in the world - has again seen growth prospects. After years of subdued growth and weak demand, Germany may now be in a position to enjoy a robust recovery. Further progress in economic reforms could turn this cyclical upswing into a sustained expansion, with stronger supply conditions and higher permanent incomes feeding back into more buoyant current demand.

Corporate restructuring and growing capital markets are setting the foundations that could allow Germany to meet the long-term challenges of European economic integration and globalization, particularly if labor market rigidities are further addressed.

Siegle, Hu & Partners International provide clients with the expertise to define key success factors when entering / developing the German marketplace

Success Story - BERLIN CHEMIE, The Right Chemistry for Italian Investor

When Menarini, the giant Italian pharmaceuticals group, bought Berlin-Chemie from Germany’s privatization agency in 1992, there were few who would have dared believe the Adlershof-based concern would, in little more than a decade, become one of the fastest growing companies in Europe.

But it’s a fact. Berlin-Chemie Menarini increased its sales by 25 percent to €503 million in 2003. In the process, it took on 650 new employees, bringing the total number of staff to 3,227 – exceeding the number it had even in the overstaffed years. The year before, turnover rose 24.3 percent to €404 million. This year, turnover is again predicted to increase, this time by more than €100 million.

The company is currently enlarging its Adlershof production facilities. “We have to increase our capacity threefold in the coming years,” explains Reinhard Uppenkamp, the company’s chief executive. A sales target of €600 million has been set by the management this year. An additional 600 employees will be hired, a third of them in Berlin. “We’re growing at a double digit rate,” says Uppenkamp. Among German pharmaceutical concerns, Berlin-Chemie Menarini ranks 19th in size. But following seven years of rapid growth, Uppenkamp reckons it might soon be in the top ten bracket.

Success Story - MOTOROLA in Germany, Shaping the Future

They invented the mobile phone and produced the radio trans-ponder used by Neil Armstrong to speak his famous first words from the moon. Motorola, one of the world’s most innovative companies, is shaping the future in Germany.

Motorola has significant operations in every major market around the world. The United States, where the company is based, is obviously a key region. As is China, where rapid economic growth is helping to drive the company’s expansion. But when it comes to the largest market of all – the 25-nation European Union – Motorola has staked its success on one country in particular: Germany.

The company that invented the mobile phone has not one but five strategically vital locations in Germany. Spread out around the country, Motorola’s German units (Berlin, Flensburg, Taunusstein, Munich and Bad Salzdetfurth) are highly specialized, each focusing on different sets of technologies. Lean and efficient, the units have all been exploiting location-specific synergies, enabling them to collectively leverage the advantage of doing business in Europe’s largest economy

The Heart of Europe: Transportation Modes and Times from Germany to the EU

Germany is Euope’s No. 1 Hig-Tech Location

Quality and skills
Information technology, communications, biotechnology, pharmaceuticals and energy represent the new global growth markets. Germany is already among the world leaders in these sectors. Germany industry combines innovative business methods and technological advances with a tradition of extremely high-quality workmanship. Products labelled "Made in Germany" are in demand everywhere in the world.

New targets for investment
The deregulation of the energy market and of telecommunications services and the privatisation of the postal service offer companies in Germany and elsewhere further lucrative investment opportunities.

Support for investors

Germany provides support to investors in the form of simple, clearly defined tax and levy regulations and unbureaucratic approval procedures.

Many leading international companies have already established subsidiaries or strategic alliances in Germany, in order to take advantage of the huge benefits offered by Germany as an investment location.

An Example for Germany’s Competitiveness: Wind power

The Federal Republic of Germany is the number one country for wind power. Germany has more than a third of the installed capacity worldwide, placing it at the peak of development and application in wind power technology. For international comparison, the only other countries that have more than 1,000 MW of installed capacity from wind energy are Spain, Denmark, the USA, and India.

We can safely assume that there will be further growth in German wind power capacity at between 35 and 40% for the next years. The reason for this unique boom in the last 10 years is the promotional programs of both national and regional government to make this form of energy generation attractive for private purposes, in agriculture, and in city-owned utilities; a further incentive is a legally fixed remuneration for supplying wind energy on stream. These promotions have led to technical improvements and the switch to larger units, thus leading to a reduction in both investment and electricity prices.

The number of locations suitable for wind generation units and the acceptance of the population in Germany is, however, limited. For this reason, more emphasis has been placed on extending offshore potential of the coasts.

In many countries outside of Europe, the conditions for energy generation through wind power are much more favorable? high wind speed inland that stays constant almost all year round in many cases, or long coasts that favor offshore units. The economics of wind power projects that are to run in parallel with the main power supply is not least dependent on the political conditions set for the energy sector. The conditions for the energy sector are favorable in many developing countries and those on the verge of industrialization, and the incentive systems are already there. Small units that are independent of the main network, however, present an opportunity for independently supplying households and community facilities with electricity in regions where supporting measures from energy policy are lacking.

Services provided by German manufacturers of wind power units include planning, construction, equipping, engineering, operational monitoring, financing, and training.