Germany – The Ideal Business Destination
International business and foreign observers generally take a much more positive view of Germany than the Germans themselves do. This fact is also reflected in scientific studies and the international press. The British news magazine The Economist , for example, recently ran an editoral which presented the development of the German economy in a positive light. And when the auditing firm Ernst&Young asked 500 entrepreneurs from across the globe what countries they considered the most attractive for investors, Germany came first in Europe and third overall. What is more, analysts see the German economy on a promising course: Goldman Sachs is betting on Germany’s increasing competitiveness within the eurozone, and the Bank of America sees positive signs of growth for 2007 and 2008.
Popular with foreign investors
More than 10,000 foreign companies operate in Germany – with a total workforce of over two million and a total annual turnover of more than EUR 750 billion. In terms of infrastructure, logistics, research and development and design, Germany is held in the highest regard by foreign investors. The overwhelmingly positive assessment of Germany’s R&D landscape reflects the strong belief in Germany’s competitiveness, especially in the sunrise technologies. As the world’s leading export nation, Germany knows that to remain attractive to investors it must convince them that “Made in Germany” is an unmistakable mark of quality.
In terms of logistics and telecommunications, too, Germany’s modern and comprehensive transport infrastructure and its highly developed communications networks make it an ideal business destination. And investors value German workers’ excellent skill levels at least as highly as the competitive edge the country gains by being Europe’s largest internal market. At the centre of the enlarged EU, Germany accounts for nearly a fifth of the entire EU market.
Germany also gets top marks from foreign investors for political stability, legal certainty and quality of life. Other important factors contributing to this positive picture are, without a doubt, Germany’s rich cultural scene, the diversity of its natural environment and its world-famous tourist attractions.
Reforms are showing results
By implementing restructuring and cost-saving measures, German companies have succeeded in improving their international competitiveness. This process has also been helped by falling unit labour costs, which are now below those of France, Spain and Italy. Business magazines like The Economist are giving particular attention to the German government’s efforts to reform the country’s labour market.
Germany has received praise not only for boosting the volume of incoming orders and increasing its industrial production but also for improving its business climate. In terms of both innovativeness and domestic investor confidence, the outlook for Germany is definitely good, despite the huge challenges posed by globalization, EU enlargement, the introduction of the euro and the opening up of Eastern and Central-Eastern Europe.
Germany’s positive image is also reflected in the high ranking it received in the 2005 Nation Brands Index. Also known as the Anholt GMI Index, this assessment instrument takes into account other factors besides economic criteria when determining what constitutes a country’s “brand image”: culture, politics, its people and its attractiveness to tourists. The index puts Germany in seventh place, ahead of countries like The Netherlands, France, New Zealand, the USA and Spain.
Last updated 23.09.2005
