Germany  is one of the world’s most skilled market economies and the largest national economy in Europe. It is a founding member of the European Union and the Eurozone. The country is the fourth-largest by nominal GDP in the world, and fifth largest by purchasing power parity (PPP).

Germany is the most industrialized nation in Europe, holding major players in industries like automobile manufacturing, machinery, precision equipments, heavy automotive, technology and softwares.

Germany is the headquarters of 37 of the world’s 500 largest stock market listed companies, making it competitive internationally, namely Volkswagen, Allianz, E.ON, Daimler, Siemens, Metro, Deutsche Telekom, Munich Re, BASF, and BMW, 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).

In addition, the country has ten thousands of small and medium-sized enterprises (up to 500 employees) in manufacturing, in particular mechanical engineering, the supplier industry, as well as nano and biotechnology. More than 25 million people are employed in the small and medium-sized enterprises, making them the biggest employer and regarded as the backbone of the German economy.

The country is the largest producer of lignite in the world and is also abundant in timber, iron ore, potash, salt, uranium, nickel, copper and natural gas. The country mostly sourced energy from fossil fuels, followed by nuclear power, and by renewable energy such as biomass (wood and biofuels), wind, hydro and solar.

Additionally, Germany is the world’s top location for trade fairs. About two thirds of the world’s leading trade fairs conducted in the country.

Industry:

Germany has the world’s largest and much diversified industrial sector. The country holds a leadership position in many sectors worldwide. It has a broad basis with a strong workforce (five million people work in industrial companies), in comparison with other industrial nations such as Great Britain and the USA.

The Key industries in Germany :-

• Automotive
• Chemicals and Pharmaceuticals
• Information & Communications Technology
• Machinery & Equipment
• Medical Technology
• Metal & Steel Industry
• Renewable Energy
• Building and construction
• Precision Engineering & Optics
• Aerospace Engineering
• Service Sectors

Automotive:

The automotive industry is considered as the driving force of the German economy. The country stands as the fourth-largest producer of automobiles in the world, following Japan, the US and China. The automotive industry receives materials from a large network of suppliers including mechanical engineering, metalworking, and the textile and chemical industries.

To survive in this competitive world, the companies in the automotive industry constantly change their structure and technologies with their high technological skill and innovation. The automotive industry spends more money on research and development than other German industries, with annual expenditures amounting to some €27 billion. In 2013, it employed around 756,000 people and sees annual revenues of around €360 billion, an increase of 1.6% from the previous year.

Chemicals and pharmaceuticals:

This sector includes a variety of products such as fine chemicals, specialty chemicals, petrochemicals, inorganic chemicals, synthetic materials, agrochemicals and fertilisers, laundry and cleaning agents, cosmetics, pharmaceuticals, paints and adhesives. It is the third-largest industrial sector in terms of revenues in Germany.

The sector with its high number of innovations and wide range of products becomes a major supplier for other industries. The federal government through its High-Tech Strategy actively supports innovations in the chemical and pharmaceutical industry. This sector reaches revenues of €186.8 billion in 2012

Information & Communications Technology (ICT):

The German ICT sector is considered as one of the most innovative in the world with its increasing digitization in almost all aspects of everyday life. This digital evolution is having a major influence on industry, work processes, education and research, communications and network security. The sector employs around 915,000 people.

Germany is one of the world’s most important exporters of ICT products, and its ICT industry is the EU’s largest – for both customers and producers. The country also hosts the world’s largest IT trade fair, CeBIT, every year bringing together more than 4,000 exhibitors representing some 70 countries.

The intelligent use of modern information and communications technology (ICT) is helping society to save energy in many ways, whether through smart power grids, modern building management or efficient logistics solutions.

In 2013, ICT sector scores revenues of €228 billion, making the country fourth-largest market in the world.

Machinery & Equipment:

The machinery and equipment industry is one of the most important industries in the German economy, dominating with small and medium sized companies, which renders customized single products and small series for both domestic and international manufacturing industries. It is the second largest industrial sector in Germany in terms of revenue, mechanical and plant engineering.

Around one million highly qualified engineers and skilled workers are employed in this industry to maintain leadership in exports. The industry generated revenues of more than €209 billion in 2012.

Medical Technology:

Germany becomes the leading location for medical technology in Europe and the second biggest medical technology producer and medical services provider with the rising demand of medical supplies across the globe.

The industry advances new technologies and medical products in areas such as clinical engineering, medical, X-ray and ultrasound imaging, rehabilitation, and regenerative medicine. It also includes technologies from electrical engineering/electronics to precision mechanics and optics, as well as from the biotechnology industries.

The companies from the medical technology industry generated revenues of around €22.8 billion in 2013.

Metal & Steel Industry:

The metal manufacturing and processing sector is also plays an important role in Germany. It is the one of the largest manufacturing sector in the country and includes the steel and iron, non-ferrous metal, and foundry industries.

The German steel industry has established itself as a leading producer in the European Union with its innovative capabilities and high-quality products. Around half of the production output is exported to other countries. The country is the largest steel producer, consumer, importer and exporter in Europe with an annual production volume of about 43 million tons of raw steel. The sector generated revenues of € 46 billion in 2013.

Besides developing new products, the German metal and steel industry also concentrates on objectives related to the energy, raw materials and the environment. It is particularly emphasised on further improving the use of recycled materials, which now accounts for 50% of the material used in the production process.

Renewable Energy:

Germany presently is a global leader in both renewable energies as well as environmental technologies. This sector is comprised of Wind power, Bioenergy, Combined heat and power, Solar energy and Environmental technologies.

Gradually, renewable energies have become an important economic and social factor in Germany, with an aim to produce 80% of the electricity from renewable energy by 2050. Since, the federal government decided to turn off all nuclear power stations by 2022, the industry has been focusing on alternative sources of energy.

Building and construction:

In Germany, the construction industry is booming every year by increasing overall economic demand. It is a major contributor in generating value and creating jobs in the German economy. Many other industries are linked to the construction industry, and as a result the construction industry serves as an economic driver to generate prosperity.

 

Precision engineering and optics:

The precision engineering and optics industry has progresses as one of the most important German industries in terms of growth and future prospects. This sector employs a total of 240,000 people in more than 900 companies and provides products to many different industries, such as electronics, IT or the health sector. The industry generated overall revenues of €50,18 billion in 2013.

Aerospace engineering:

The aerospace industry in Germany is experiencing strong growth with the help of its research and key technologies related to the exploration of the Earth and the solar system, research for preserving the environment, the development of environmentally compatible technologies for increasing mobility, and the areas of communication and security. The aerospace industry makes major investments in the areas of research and development with the aim of achieving a competitive research infrastructure.

Presently, the industry with its 105,500 employees registers annual revenues of some €30.5 billion and every year the federal government invest around €1 billion on Aerospace applications and research.

Service Sectors:

In Germany, the service sector holds a wide range of business activities dealing with indefinable goods. The knowledge-driven services play a vital role in the German economy by contributing around 30% to the German gross value added.

Trade, transport, banking, finance, and administration are the leading employer of the German service sector. This is abundantly clear in urban centres throughout western Germany, with their concentration of retailing, banking, and insurance.

The industry a key pillar of the German economy today as the tertiary sector accounts for more than 70% of GDP and more than two thirds of the labor market.

Government Programs:

The German federal government plays a crucial role in the German economy, sometimes directly and sometimes indirectly through the effects of other policies on the economy.

In Germany, contractual agreements are safe and intellectual property is strictly protected with the help of the highly qualified judiciary and civil services.

Germany offers a wide range of incentives package to all investors, regardless of whether they are from Germany or otherwise for establishing production facility, to buy buildings, machinery, and equipment, labor and research and development (R&D) etc.

The package includes cash incentives, loan programs offering reduced interest rates, and public guarantees at the state and national level. Public guarantees, which are granted by the German states and federal government, help to secure private bank loans by replacing absent securities. The amount of these investment incentives generally depends on three factors: project scope, investor company size, and the new investment location.

Foreign Partnership:

Germany specializes in developing and manufacturing complex industrial goods, basically capital goods and innovative production technologies. The International investors consider Germany as one of the most attractive centers with the central geographic location and the stability of the law. In comparison with other countries, Germany has well infrastructure (traffic, telecommunications), the quality of its higher education institutes and research facilities, research and development, and the qualifications of its workforce.

At present, the direct investment from outside the country stands at EUR 460 billion and includes major investments from corporations such as General Electric and AMD from the USA.

In order to attract more business from cross borders, the German government is working towards the removal of legal restrictions and working process in cross borders through bilateral agreements in the General Agreement on the Trade in Services (GATS), and through the implementation of the EU services directive.

Opportunities:

Germany is expected as an excellent value for money for business in 2015. It will also prove to be a great ROI and savings approach in next year.

The Federal Government along with the federal states and business plans to boost the investment on research and development to 3% of the gross domestic product by 2015.

Presently, Germany invests upto 2.6% of its gross domestic product, clearly above the EU average of 1.9 percent (2008), on research and development (R&D).

 

Tendersinfo.com with a team of experts offer assistance to companies from the earliest stages of expansion strategy. We helps companies globally to tab government opportunities by offering them relevant information covering everything from Business Information Services  , Bid Consultancy Services.

we have 3300 Live Business Opportunity in Our website www.tendersinfo.com

we calls on companies to profit from its free trial service. A team of consultants is at hand to provide the significant background information on the Business Opportunities available in Germany.

 

By Jahara Khan
Sr. Copy Editor (Content & Research) – Tendersinfo