The economy of Germany is a highly developed social market economy. It has the largest national economy in Europe, the fourth-largest by nominal GDP in the world, and fifth by GDP (PPP). In 2017, the country accounted for 28% of the euro area economy according to the IMF. Germany is a founding member of the European Union and the Eurozone.
In 2016, Germany recorded the highest trade surplus in the world worth $310 billion, making it the biggest capital exporter globally. Germany is the third largest exporter in the world with 1.21 trillion euros ($1.27 trillion) in goods and services exported in 2016. The service sector contributes around 70% of the total GDP, industry 29.1%, and agriculture 0.9%. Exports account for 41% of national output.  The top 10 exports of Germany are vehicles, machinery, chemical goods, electronic products, electrical equipment, pharmaceuticals, transport equipment, basic metals, food products, and rubber and plastics. The economy of Germany is the largest manufacturing economy in Europe and it is less likely to be affected by the financial downturn  and conduct applied research with practical industrial value and sees itself as a bridge between the latest university insights and industry-specific product and process improvements, and by generating a great deal of knowledge in its own laboratories as well. In July 2017, the International Monetary Fund gave the country's economy "yet another bill of good health" and some advice on steps it might take to maintain this level in the long run.
Germany is rich in timber, lignite, potash and salt. Some minor sources of natural gas are being exploited in the state of Lower Saxony. Until reunification, the German Democratic Republic mined for uranium in the Ore Mountains (see also: SAG/SDAG Wismut). Energy in Germany is sourced predominantly by fossil fuels (50%), followed by nuclear power second, then gas, wind, biomass (wood and biofuels), hydro and solar. Germany is the first major industrialized nation to commit to the renewable energy transition called Energiewende. Germany is the leading producer of wind turbines in the world. Renewables now produce over 27% of electricity consumed in Germany.
99 percent of all German companies belong to the German "Mittelstand," small and medium-sized enterprises, which are mostly family-owned. Of the world's 2000 largest publicly listed companies measured by revenue, the Fortune Global 2000, 53 are headquartered in Germany, with the Top 10 being Allianz, Daimler, Volkswagen, Siemens, BMW, Deutsche Telekom, Bayer, BASF, Munich Re and SAP.
Germany is the world's top location for trade fairs. Around two thirds of the world's leading trade fairs take place in Germany. The largest annual international trade fairs and congresses are held in several German cities such as Hanover, Frankfurt, Cologne, Leipzig and Düsseldorf.
|Economy of Germany|
|Currency||Euro (EUR) = 1.13 USD|
|EU, WTO and OECD|
GDP per capita
GDP per capita rank
GDP by sector
GDP by component
|29.1 low (2017)|
Labour force by occupation
|Unemployment||3.4% (July 2018)|
Average gross salary
|€3,880 / $4,360 monthly (2018)|
|€2,360 / $2,652 monthly (2018)|
|Exports||$1.434 trillion (2017 est.)|
|motor vehicles, machinery, chemicals, computer and electronic products, electrical equipment, pharmaceuticals, metals, transport equipment, foodstuffs, textiles, rubber and plastic products|
Main export partners
|Imports||$1.135 trillion (2017 est.)|
|machinery, data processing equipment, vehicles, chemicals, oil and gas, metals, electric equipment, pharmaceuticals, foodstuffs, agricultural products|
Main import partners
|$291 billion (2017 est.)|
Gross external debt
|$5.084 trillion (31 March 2017)|
| 60.9% of GDP (2018) |
63.9% of GDP (2017 est.)[note 1]
|+1.3% of GDP (2017 est.)|
|Revenues||1.665 trillion (2017 est.)|
|Expenses||1.619 trillion (2017 est.)|
|Economic aid||donor: ODA, $24.67 billion (2016)|
|Standard & Poor's: AAA|
|$0.36 trillion (June 2018)|
The establishment of the Deutscher Zollverein (German Customs Union) in 1834 and the expansion of railway systems were the main drivers of Germany's industrial development and political union. From 1834, tariff barriers between increasing numbers of the Kleindeutschland German states were eliminated. In 1835 the first German railway linked the Franconian cities of Nuremberg and Fürth - it proved so successful that the decade of the 1840s saw "railway mania" in all the German states. Between 1845 and 1870, 5,000 more miles of rail had been built and in 1850 Germany was building its own locomotives. Over time, other German states joined the customs union and started linking their railroads, which began to connect the corners of Germany together. The growth of free trade and of a rail system across Germany intensified economic development which opened up new markets for local products, created a pool of middle managers, increased the demand for engineers, architects and skilled machinists, and stimulated investments in coal and iron.
Another factor which propelled German industry forward was the unification of the monetary system, made possible in part by political unification. The Deutsche Mark, a new monetary coinage system backed by gold, was introduced in 1871. However, this system did not fully come into use as silver coins retained their value until 1907.
The victory of Prussia and her allies over Napoleon III of France in the Franco-Prussian War of 1870-1871 marked the end of French hegemony in Europe and resulted in the proclamation of the German Empire in 1871. The establishment of the empire inherently presented Europe with the reality of a new populous and industrializing polity possessing a considerable, and undeniably increasing, economic and diplomatic presence. The influence of French economic principles produced important institutional reforms in Germany, including the abolition of feudal restrictions on the sale of large landed estates, the reduction of the power of the guilds in the cities, and the introduction of a new, more efficient commercial law. Nonetheless, political decisions about the economy of the empire were still largely controlled by a coalition of "rye and iron", that is the Prussian Junker landowners of the east and the Ruhr heavy industry of the west.
Regarding politics and society, between 1881 and 1889 Chancellor Otto von Bismarck promoted laws that provided social insurance and improved working conditions. He instituted the world's first welfare state. Germany was the first to introduce social insurance programs including universal healthcare, compulsory education, sickness insurance, accident insurance, disability insurance, and a retirement pension. Moreover, the government's universal education policy bore fruit with Germany achieving the highest literacy rate in the world – 99% – education levels that provided the nation with more people good at handling numbers, more engineers, chemists, opticians, skilled workers for its factories, skilled managers, knowledgeable farmers and skilled military personnel.
By 1900 Germany surpassed Britain and the United States in steel production. The German economic miracle was also intensified by an unprecedented population growth from 35 million in 1850 to 67 million in 1913. From 1895 to 1907, the number of workers engaged in machine building doubled from half a million to well over a million. Only 40 percent of Germans lived in rural areas by 1910, a drop from 67% at the birth of the Empire. Industry accounted for 60 percent of the gross national product in 1913. The German chemical industry became the most advanced in the world, and by 1914 the country was producing half the world's electrical equipment.
The rapid advance to industrial maturity led to a drastic shift in Germany's economic situation – from a rural economy into a major exporter of finished goods. The ratio of finished product to total exports jumped from 38% in 1872 to 63% in 1912. By 1913 Germany had come to dominate all the European markets. By 1914 Germany had become one of the biggest exporters in the world.
The Nazis rose to power while unemployment was very high, but achieved full employment later thanks to massive public works programs such as the Reichsbahn, Reichspost and the Reichsautobahn projects. In 1935 rearmament in contravention of the Treaty of Versailles added to the economy.
Weimar and Nazi Germany By Stephen J. Lee
The post 1931 financial crisis economic policies of expansionary fiscal policies (as Germany was off the gold standard) was advised by their non-Nazi Minister of Economics, Hjalmar Schacht, who in 1933 became the president of the central bank. Hjalmar Schacht later abdicated from the post in 1938 and was replaced by Hermann Göring.
The trading policies of the Third Reich aimed at self sufficiency but with a lack of raw materials Germany would have to maintain trade links but on bilateral preferences, foreign exchange controls, import quotas and export subsidies under what was called the "New Plan"(Neuer Plan) of 19 September 1934. The "New Plan" was based on trade with less developed countries who would trade raw materials for German industrial goods saving currency. Southern Europe was preferable to Western Europe and North America as there could be no trade blockades. This policy became known as the Grosswirtschaftsraum ("greater economic area") policy.
Eventually, the Nazi party developed strong relationships with big business and abolished trade unions in 1933 in order to form the National Labour Service (RAD), German Labour Front (DAF) to set working hours, Beauty of Labour (SDA) which set working conditions and Strength through Joy (KDF) to ensure sports clubs for workers.
Beginning with the replacement of the Reichsmark with the Deutsche Mark as legal tender, a lasting period of low inflation and rapid industrial growth was overseen by the government led by German Chancellor Konrad Adenauer and his minister of economics, Ludwig Erhard, raising West Germany from total wartime devastation to one of the most developed nations in modern Europe.
In 1953 it was decided that Germany was to repay $1.1 billion of the aid it had received. The last repayment was made in June 1971.
Apart from these factors, hard work and long hours at full capacity among the population in the 1950s, 1960s and early 1970s and extra labor supplied by thousands of Gastarbeiter ("guest workers") provided a vital base for the economic upturn.
By the early 1950s the Soviet Union had seized reparations in the form of agricultural and industrial products and demanded further heavy reparation payments. Silesia with the Upper Silesian Coal Basin, and Stettin, a prominent natural port, were lost to Poland.
Exports from West Germany exceeded $323 billion in 1988. In the same year, East Germany exported $30.7 billion worth of goods; 65% to other communist states. East Germany had zero unemployment.
In 1976 the average annual GDP growth was roughly 5.9%.
The German economy practically stagnated in the beginning of the 2000s. The worst growth figures were achieved in 2002 (+1.4%), in 2003 (+1.0%) and in 2005 (+1.4%). Unemployment was also chronically high. Due to these problems, together with Germany's aging population, the welfare system came under considerable strain. This led the government to push through a wide-ranging program of belt-tightening reforms, Agenda 2010, including the labour market reforms known as Hartz I - IV.
In the later part of the first decade of 2000 the world economy experienced high growth, from which Germany as a leading exporter also profited. Some credit the Hartz reforms with achieving high growth and declining unemployment but others contend that they resulted in a massive decrease in standards of living, and that its effects are limited and temporary.
The nominal GDP of Germany contracted in the second and third quarters of 2008, putting the country in a technical recession following a global and European recession cycle. German industrial output dropped to 3.6% in September vis-à-vis August. In January 2009 the German government under Angela Merkel approved a €50 billion ($70 billion) economic stimulus plan to protect several sectors from a downturn and a subsequent rise in unemployment rates. Germany exited the recession in the second and third quarters of 2009, mostly due to rebounding manufacturing orders and exports - primarily from outside the Euro Zone - and relatively steady consumer demand.
Germany is a founding member of the EU, the G8 and the G20, and was the world's largest exporter from 2003 to 2008. In 2011 it remained the third largest exporter and third largest importer. Most of the country's exports are in engineering, especially machinery, automobiles, chemical goods and metals. Germany is a leading producer of wind turbines and solar-power technology. Annual trade fairs and congresses are held in cities throughout Germany. 2011 was a record-breaking year for the German economy. German companies exported goods worth over €1 trillion ($1.3 trillion), the highest figure in history. The number of people in work has risen to 41.6 million, the highest recorded figure.
Through 2012, Germany's economy continued to be stronger relative to local neighboring nations.
As of December 2017, the unemployment rate was at 5.5 percent.
As of January 2015, the unemployment rate was 4.8 percent.
As of December 2014, the CPI rate was 0.6 percent.
The following table shows the main economic indicators in 1980–2018. Inflation below 2% is in green.
1980 to 1995
(in bn. Euro)
|GDP per capita
|1.3 %||0.1 %||0.8 %||1.6 %||2.8 %||2.2 %||2,4 %||1,5 %||3.7 %||3.9 %||5.7 %||5.0 %||1.5 %||1.0 %||2.5 %||1.8 %|
|5.4 %||6.3 %||5.3 %||3.3 %||2.4 %||2.0 %||0.1 %||0.2 %||1.3 %||2.8 %||2.7 %||3.4 %||5.0 %||4.5 %||2.7 %||1.7 %|
|3.4 %||4.8 %||6.7 %||8.0 %||8.1 %||8.1 %||7.8 %||7.8 %||7.7 %||6.8 %||6.2 %||5.5 %||6.6 %||7.8 %||8.4 %||8.2 %|
(in % of GDP)
|...||...||...||...||...||...||...||...||...||...||...||3.2 %||2.6 %||3.1 %||2.5 %||9.4 %|
1996 to 2010
(in bn. Euro)
|GDP per capita
|0.9 %||1.9 %||1.8 %||1.9 %||3.2 %||1.8 %||0 %||0.7 %||0.7 %||0.9 %||3.9 %||3.4 %||0.8 %||5.6 %||3.9 %|
|1.2 %||1.5 %||0.6 %||0.6 %||1.4 %||1.9 %||1.4 %||1.0 %||1.8 %||1.9 %||1.8 %||2.3 %||2.7 %||0.2 %||1.2 %|
|8.9 %||9.7 %||9.4 %||8.6 %||8.0 %||7.8 %||8.6 %||9.7 %||10.3 %||11.0 %||10.0 %||8.6 %||7.4 %||7.7 %||6.9 %|
(in % of GDP)
|3.5 %||2.9 %||2.5 %||1.7 %||0.8 %||3.1 %||3.9 %||4.2 %||3.7 %||3.4 %||1.7 %||0.2 %||0.2 %||3.2 %||4.2 %|
2011 to 2018
(in bn. Euro)
|GDP per capita
|3.7 %||0.7 %||0.6 %||2.2 %||1.5 %||2.2 %||2.5 %||1.5 %|
|2.5 %||2.1 %||1.6 %||0.8 %||0.1 %||0.4 %||1.7 %||1.9 %|
|5.9 %||5.4 %||5.2 %||5.0 %||4.6 %||4.2 %||3.8 %||3.4 %|
(in % of GDP)
|1.0 %||0 %||0.1 %||0.3 %||0.6 %||0.8 %||1.1 %||1.7 %|
Of the world's 500 largest stock-market-listed companies measured by revenue in 2010, the Fortune Global 500, 37 are headquartered in Germany. 30 Germany-based companies are included in the DAX, the German stock market index. Well-known global brands are Mercedes-Benz, BMW, SAP, Siemens, Volkswagen, Adidas, Audi, Allianz, Porsche, Bayer, BASF, Bosch, and Nivea.
Germany is recognised for its specialised small and medium enterprises, known as the Mittelstand model. Around 1,000 of these companies are global market leaders in their segment and are labelled hidden champions.
From 1991 to 2010, 40,301 mergers and acquisitions with an involvement of German firms with a total known value of 2,422 bil. EUR have been announced. The largest transactions since 1991 are: the acquisition of Mannesmann by Vodafone for 204.8 bil. EUR in 1999, the merger of Daimler-Benz with Chrysler to form DaimlerChrysler in 1998 valued at 36.3 bil. EUR.
The list includes the largest German companies by revenue in 2011:
|4.||Siemens AG||Berlin, München||SIEGn||74,000||6,300||360,000|
|5.||BASF SE||Ludwigshafen am Rhein||BASFn||73,000||6,600||111,000|
|9.||Deutsche Telekom AG||Bonn||DTEGn||59,000||670||235,000|
|10.||Deutsche Post AG||Bonn||DPWGn||53,000||1,300||471,000|
|—||Robert Bosch GmbH||Gerlingen||73,100||2,300||390,000|
|—||Deutsche Bank AG||Frankfurt am Main||DBKGn||2,160,000||4,300||101,000|
Since the German reunification there have been 52,258 mergers or acquisitions deals inbound or outbound Germany. The most active year in terms of value was 1999 with a cumulated value of 48. bil. EUR, twice as much as the runner up which was 2006 with 24. bil. EUR (see graphic "M&A in Germany").
Here is a list of the top 10 deals (ranked by value) that include a German company. The Vodafone - Mannesmann deal is still the biggest deal in global history.
|Rank||Date||Acquirer||Acquirer Nation||Target||Target Nation||Value (in bil. USD)|
|1||14 Nov 1999||Vodafone AirTouch PLC||United Kingdom||Mannesmann AG||Germany||202.79|
|2||18 May 2016||Bayer AG||Germany||Monsanto Co||United States||56.60|
|3||6 May 1998||Daimler-Benz AG||Germany||Chrysler Corp||United States||40.47|
|4||16 Aug 2016||Linde AG||Germany||Praxair Inc||United States||35.16|
|5||21 Oct 1999||Mannesmann AG||Germany||Orange PLC||United Kingdom||32.59|
|6||24 Jul 2000||Deutsche Telekom AG||Germany||VoiceStream Wireless Corp||United States||29.40|
|7||17 May 1999||Rhone-Poulenc SA||France||Hoechst AG||Germany||21.92|
|8||23 Mar 2006||Bayer AG||Germany||Schering AG||Germany||21.40|
|9||01 Apr 2001||Allianz AG||Germany||Dresdner Bank AG||Germany||19.66|
|10||30 May 2005||Unicredito Italiano SpA||Italy||Bayerische Hypo- und Vereins||Germany||18.26|
Germany as a federation is a polycentric country and does not have a single economic center. The stock exchange is located in Frankfurt am Main, the largest Media company (Bertelsmann SE & Co. KGaA) is headquartered in Gütersloh; the largest car manufacturers are in Wolfsburg (Volkswagen), Stuttgart (Mercedes-Benz and Porsche), and Munich (Audi and BMW).
Germany is an advocate of closer European economic and political integration. Its commercial policies are increasingly determined by agreements among European Union (EU) members and EU single market legislation. Germany introduced the common European currency, the euro on 1 January 1999. Its monetary policy is set by the European Central Bank in Frankfurt.
The southern states ("Bundesländer"), especially Bayern, Baden-Württemberg and Hessen, are economically stronger than the northern states. One of Germany's traditionally strongest (and at the same time oldest) economic regions is the Ruhr area in the west, between Duisburg and Dortmund. 27 of the country's 100 largest companies are located there. In recent years, however, the area, whose economy is based on natural resources and heavy industry, has seen a substantial rise in unemployment (2010: 8.7%).
The economy of Bayern and Baden-Württemberg, the states with the lowest number of unemployed people (2018: 2.7%, 3.1%), on the other hand, is based on high-value products. Important sectors are automobiles, electronics, aerospace and biomedicine, among others. Baden-Württemberg is an industrial center especially for automobile and machine building industry and the home of brands like Mercedes-Benz (Daimler), Porsche and Bosch.
With the reunification on 3 October 1990, Germany began the major task of reconciling the economic systems of the two former republics. Interventionist economic planning ensured gradual development in eastern Germany up to the level of former West Germany, but the standard of living and annual income remains significantly higher in western German states. The modernisation and integration of the eastern German economy continues to be a long-term process scheduled to last until the year 2019, with annual transfers from west to east amounting to roughly $80 billion. The overall unemployment rate has consistently fallen since 2005 and reached a 20-year low in 2012. The country in July 2014 began legislating to introduce a federally mandated minimum wage which would come into effect on 1 January 2015.
|States||Rank||GRP (in billions EUR€)||Share of
Wolfsburg is the city in Germany with the country's highest per capita GDP, at $128,000. The following top 10 list of German cities with the highest per capita GDP is based on a study by the Cologne Institute for Economic Research on 31 July 2013.
Germany has a social market economy characterised by a highly qualified labor force, a developed infrastructure, a large capital stock, a low level of corruption, and a high level of innovation. It has the largest national economy in Europe, the fourth largest by nominal GDP in the world, and ranked fifth by GDP (PPP) in 2015.
In 2010 agriculture, forestry, and mining accounted for only 0.9% of Germany's gross domestic product (GDP) and employed only 2.4% of the population, down from 4% in 1991. Agriculture is extremely productive, and Germany is able to cover 90% of its nutritional needs with domestic production. Germany is the third largest agricultural producer in the European Union after France and Italy. Germany's principal agricultural products are potatoes, wheat, barley, sugar beets, fruit, and cabbages.
Despite the country's high level of industrialization, almost one-third of its territory is covered by forest. The forestry industry provides for about two-thirds of domestic consumption of wood and wood products, so Germany is a net importer of these items.
The German soil is relatively poor in raw materials. Only lignite (brown coal) and potash salt (Kalisalz) are available in significant quantities. However, the former GDR's Wismut mining company produced a total of 230,400 tonnes of uranium between 1947 and 1990 and made East Germany the fourth largest producer of uranium ore worldwide (largest in USSR's sphere of control) at the time. Oil, natural gas and other resources are, for the most part, imported from other countries.
Germany's bituminous coal deposits were created more than 300 million years ago from swamps which extended from the present-day South England, over the Ruhr area to Poland. Lignite deposits developed in a similar way, but during a later period, about 66 million years ago. Because the wood is not yet completely transformed into coal, brown coal contains less energy than bituminous coal.
Lignite is extracted in the extreme western and eastern parts of the country, mainly in Nordrhein-Westfalen, Sachsen and Brandenburg. Considerable amounts are burned in coal plants near to the mining areas, to produce electricity. Transporting lignite over far distances is not economically feasible, therefore the plants are located practically next to the extraction sites. Bituminous coal is mined in Nordrhein-Westfalen and Saarland. Most power plants burning bituminous coal operate on imported material, therefore the plants are located not only near to the mining sites, but throughout the country.
Industry and construction accounted for 30.7% of gross domestic product in 2017, and employed 24.2% 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%.
Small- to medium-sized manufacturing firms (Mittelstand companies) which specialize in technologically advanced niche products and are often family-owned form a major part of the German economy. It is estimated that about 1500 German companies occupy a top three position in their respective market segment worldwide. In about two thirds of all industry sectors German companies belong to the top three competitors.
In 2017 services constituted 68.6% of gross domestic product (GDP), and the sector employed 74.3% of the workforce. The subcomponents of services are financial, renting, and business activities (30.5%); trade, hotels and restaurants, and transport (18%); and other service activities (21.7%).
Germany is the seventh most visited country in the world, with a total of 407 million overnights during 2012. This number includes 68.83 million nights by foreign visitors. In 2012, over 30.4 million international tourists arrived in Germany. Berlin has become the third most visited city destination in Europe. Additionally, more than 30% of Germans spend their holiday in their own country, with the biggest share going to Mecklenburg-Vorpommern. Domestic and international travel and tourism combined directly contribute over EUR43.2 billion to German GDP. Including indirect and induced impacts, the industry contributes 4.5% of German GDP and supports 2 million jobs (4.8% of total employment). The largest annual international trade fairs and congresses are held in several German cities such as Hannover, Frankfurt, and Berlin.
The debt-to-GDP ratio of Germany had its peak in 2010 when it stood at 80.3% and decreased since then. According to Eurostat, the government gross debt of Germany amounts to €2,152.0 billion or 71.9% of its GDP in 2015. The federal government achieved a budget surplus of €12.1 billion ($13.1 billion) in 2015. Germany's credit rating by credit rating agencies Standard & Poor's, Moody's and Fitch Ratings stands at the highest possible rating AAA with a stable outlook in 2016.
Germany's "debt clock" (Schuldenuhr) reversed for the first time in 20 years in January 2018. It is now running backwards at €78 per second.
Germany is the world's fifth largest consumer of energy, and two-thirds of its primary energy was imported in 2002. In the same year, Germany was Europe's largest consumer of electricity, totaling 512.9 terawatt-hours. Government policy promotes energy conservation and the development of renewable energy sources, such as solar, wind, biomass, hydroelectric, and geothermal energy. As a result of energy-saving measures, energy efficiency has been improving since the beginning of the 1970s. The government has set the goal of meeting half the country's energy demands from renewable sources by 2050.
In 2000, the red-green coalition under Chancellor Schröder and the German nuclear power industry agreed to phase out all nuclear power plants by 2021. The conservative coalition under Chancellor Merkel reversed this decision in January 2010, electing to keep plants open. The nuclear disaster of the Japanese nuclear plant Fukushima in March 2011 however, changed the political climate fundamentally: Older nuclear plants have been shut down. And a general phase out until 2020 or 2022 is now probable. Renewable energy yet still plays a more modest role in energy consumption, though German solar and windpower industries play a leading role worldwide.
In 2009, Germany's total energy consumption (not just electricity) came from the following sources: Oil 34.6%, Natural gas 21.7%, Lignite 11.4%, Bituminous coal 11.1%, Nuclear power 11.0%, Hydro and wind power 1.5%, Others 9.0%.
There are 3 major entry points for oil pipelines: in the northeast (the Druzhba pipeline, coming from Gdańsk), west (coming from Rotterdam) and southeast (coming from Nelahozeves). The oil pipelines of Germany do not constitute a proper network, and sometimes only connect two different locations. Major oil refineries are located in or near the following cities: Schwedt, Spergau, Vohburg, Burghausen, Karlsruhe, Cologne, Gelsenkirchen, Lingen, Wilhelmshaven, Hamburg and Heide.
Germany's network of natural gas pipelines, on the other hand, is dense and well-connected. Imported pipeline gas comes mostly from Russia, the Netherlands and the United Kingdom. Although gas imports from Russia have been historically reliable, even during the cold war, recent price disputes between Gazprom and the former Soviet states, such as Ukraine, have also affected Germany. As a result, high political importance is placed on the construction of the Nord Stream pipeline, running from Vyborg in Russia along the Baltic sea to Greifswald in Germany. This direct connection avoids third-party transit countries. Germany imports 50% to 75% of its natural gas from Russia.
With its central position in Europe, Germany is an important transportation hub. This is reflected in its dense and modern transportation networks. The extensive motorway (Autobahn) network that ranks worldwide third largest in its total length and features a lack of blanket speed limits on the majority of routes.
Germany has established a polycentric network of high-speed trains. The InterCityExpress or ICE is the most advanced service category of the Deutsche Bahn and serves major German cities as well as destinations in neighbouring countries. The train maximum speed varies between 200 km/h and 320 km/h (125-200 mph). Connections are offered at either 30-minute, hourly, or two-hourly intervals. German railways are heavily subsidised, receiving €17.0 billion in 2014.
The largest German airports are the Frankfurt International Airport and the Munich International Airport, both are global hubs of Lufthansa. Other major airports are Berlin Tegel, Berlin Schönefeld, Düsseldorf, Hamburg, Hanover, Cologne-Bonn, Leipzig/Halle and in the future Berlin Brandenburg International Airport.
Germany is also one of the leading countries in developing and using green technologies. Companies specializing in green technology have an estimated turnover of €200 billion. German expertise in engineering, science and research is eminently respectable.
The lead markets of Germany's green technology industry are power generation, sustainable mobility, material efficiency, energy efficiency, waste management and recycling, sustainable water management.
With regard to triadic patents Germany is in third place after the US and Japan. With more than 26,500 registrations for patents submitted to the European Patent Office, Germany is the leading European nation. Siemens, Bosch and BASF, with almost 5,000 registrations for patents between them in 2008, are among the Top 5 of more than 35,000 companies registering patents. Together with the US and Japan, with regard to patents for nano, bio and new technologies Germany is one of the world's most active nations. With around one third of triadic patents Germany leads the way worldwide in the field of vehicle emission reduction.
According to Winfried Kretschmann, who is premier of the region where Daimler is based, "China dominates the production of solar cells. Tesla is ahead in electric cars and Germany has lost the first round of digitalization to Google, Apple and the like. Whether Germany has a future as an industrial economy will depend on whether we can manage the ecological and digital transformation of our economy".
Despite economic prosperity, Germany's biggest threat for future economic development is the nation's declining birthrate which is among the lowest in the world. This is prevalent in parts of society with higher education are responsible for low fertility rates. As a result, the numbers of workers will decrease and the government spending needed to support pensioners and healthcare will increase if the trend is not reversed.
Exports are responsible for one-third of total economic output, and at the prevailing dollar–euro exchange rate, no country exports more merchandise.
There were until  [...] only the beginnings of a nexus of technological innovation and economic growth, the erratic construction of a platform for what might later be justifiably termed a take-off in Germany. But there is little evidence within the given chronological framework for a full-blown notion of an Industrial Revolution [...].
Basic income in Germany (German: Grundeinkommen), has been discussed since the 1970s, with emphasis placed on its unconditional dimension by 2003. The basic income concept has many definitions, such as Philippe van Farijs', which described it as the income paid by the government, at a uniform level and regular intervals to each adult citizen and permanent residents of the country. The Basic Income Earth Network's criteria constitute one of the most popular proposals and they include: 1) income must be paid to individuals instead of households; 2) income should be paid irrespective of income from other sources; and, 3) it must be paid without requiring performance of any work.In Germany, there is a national network as well as many local groups involved in the push for the basic income adoption as a state policy. Some of the most well-known proponents for the reform are Götz Werner, Katja Kipping, and Susanne Wiest. German political parties who are working for basic income include the Pirate Party Germany, Bündnis 90/Die Grünen, Die Violetten and since 2016 the Bündnis Grundeinkommen, which gained admission to the German federal election in 2017.Economy of Nazi Germany
The German economy, like those of many other western nations, suffered the effects of the Great Depression with unemployment soaring around the Wall Street Crash of 1929. When Adolf Hitler became Chancellor of Germany in 1933, he introduced policies aimed at improving the economy. The changes included privatization of state industries, autarky, and tariffs on imports. Although weekly earnings increased by 19% in real terms in the period between 1932-38, average working hours had also risen to approximately 60 per week by 1939. Furthermore, reduced foreign trade meant rationing in consumer goods like poultry, fruit, and clothing for many Germans.The Nazis believed in war as the primary engine of human progress, and argued that the purpose of a country’s economy should be to enable that country to fight and win wars of expansion. As such, almost immediately after coming to power, they embarked on a vast program of military rearmament, which quickly dwarfed civilian investment. During the 1930s, Nazi Germany increased its military spending faster than any other state in peacetime, and the military eventually came to represent the majority of the German economy in the 1940s. This was funded mainly through deficit financing before the war, and the Nazis expected to cover their debt by plundering the wealth of conquered nations during and after the war. Such plunder did occur, but its results fell far short of Nazi expectations.The Nazi government developed a partnership with leading German business interests, who supported the goals of the regime and its war effort in exchange for advantageous contracts, subsidies, and the suppression of the trade union movement. Cartels and monopolies were encouraged at the expense of small businesses, even though the Nazis had received considerable electoral support from small business owners.Nazi Germany maintained a supply of slave labour, composed of prisoners and concentration camp inmates, which was greatly expanded after the beginning of World War II. In Poland alone, some 5 million citizens (including Polish Jews) were used as slave labour throughout the war. Among the slave labourers in the occupied territories, hundreds of thousands were used by leading German corporations including Thyssen, Krupp, IG Farben, Bosch, Blaupunkt, Daimler-Benz, Demag, Henschel, Junkers, Messerschmitt, Siemens, and Volkswagen, as well as Dutch corporation Philips. By 1944, slave labour made up one quarter of Germany's entire work force, and the majority of German factories had a contingent of prisoners.Federal Ministry for Economic Affairs and Energy
The Federal Ministry for Economic Affairs and Energy (German: Bundesministerium für Wirtschaft und Energie), abbreviated BMWi, is a cabinet-level ministry of the Federal Republic of Germany. It was previously known as the "Ministry of Economy". It was recreated in 2005 as "Ministry of Economics and Technology" after it had previously been merged with other ministries to form the Federal Ministry for Economics and Labour between 2002 and 2005.Federal Ministry for Economic Cooperation and Development
The Federal Ministry of Economic Cooperation and Development (German: Bundesministerium für wirtschaftliche Zusammenarbeit und Entwicklung), abbreviated BMZ, is a cabinet-level ministry of the Federal Republic of Germany. Its main office is at the former German Chancellery in Bonn with a second major office at the Europahaus in Berlin.
Founded in 1961, the Ministry works to encourage economic development within Germany and in other countries through international cooperation and partnerships. It cooperates with international organizations involved in development including the International Monetary Fund, World Bank, and the United Nations.German Council of Economic Experts
The German Council of Economic Experts (German: Sachverständigenrat zur Begutachtung der gesamtwirtschaftlichen Entwicklung) is a group of economists set up in 1963 to evaluate economic policies of the German government. In the media, the council is often referred to as the "Five Sages of Economy" (Fünf Wirtschaftsweisen), or simply the "Five Sages" (Fünf Weisen).German National Library of Economics
The German National Library of Economics (ZBW – Leibniz Information Centre for Economics) is the world’s largest research infrastructure for economic literature, online as well as offline. The ZBW is a member of the Leibniz Association and has been a foundation under public law since 2007. Several times the ZBW received the international LIBER award for its innovative work in librarianship. The ZBW allows for access of millions of documents and research on economics, partnering with over 40 research institutions to create a connective Open Access portal and social web of research. Through its EconStor and EconBiz, researchers and students have accessed millions of datasets and thousands of articles. The ZBW also edits two journals: Wirtschaftsdienst and Intereconomics.German Trade Register
The German Commercial Register (German: Handelsregister) is a public company register that contains details of all tradespeople and legal entities in the district of the registrar, which is generally the Amtsgericht (local district court) of the place where the Landgericht (superior court) is also situated.
The German Commercial Register contains two branches. Branch A deals with partnerships, sole traders and registered associations (Vereine) without share capital. Branch B contains all incorporated companies with share capital. Applications (for new entries, changes and liquidations) must be made in notarized form in the presence of a public notary.List of German states by GRP
This article is about the gross regional product (GRP) of German states in main fiscal years. Most figures are from the Federal Statistical Office of Germany; figures from other sources are otherwise referenced. The GRP of German states are shown in Euro (€). For easier comparison as per IMF estimates, all the figures are converted into US$ according to annual average exchange rates.List of German states by GRP per capita
This article is about the gross regional product (GRP) per capita of German states in nominal values. Values are shown in EUR€. For easy comparison, all the GRP figures are converted into US$ according to annual average exchange rates. All values are rounded to the nearest hundred.List of German states by Human Development Index
This is a list of German states by Human Development Index as of 2017.List of Germans by net worth
The following Forbes list of German billionaires is based on an annual assessment of wealth and assets compiled and published by Forbes magazine in 2015.List of exports of Germany
The following is a list of the exports of Germany. Data is for 2012, in millions of United States dollars, as reported by The Observatory of Economic Complexity. Currently the top thirty exports are listed.List of the largest trading partners of Germany
This is a list of the largest trading partners of Germany in 2016, based on data from the Federal Statistical Office of Germany (Destatis).Made in Germany
Made in Germany is a merchandise mark indicating that a product has been manufactured in Germany.Mittelstand
Mittelstand commonly refers to small and medium-sized enterprises in German-speaking countries, especially in Germany, Austria and Switzerland, however Britain also has its own. The term Mittelstand proves difficult to translate and causes a lot of confusion. The majority of definitions define the Mittelstand as a statistical category and most commonly suggest that Mittelstand firms are small and medium-sized enterprises (SMEs; German, kleine und mittlere Unternehmen or KMU) with annual revenues up to 50 million Euro and a maximum of 499 employees.The term is not officially defined or self-explanatory hence, in English linguistic terms SMEs are not necessarily equivalent to the Mittelstand. In fact, even larger, and often family-owned, firms claim to be part of the Mittelstand, such as Robert Bosch based on the Mittelstand's positive connotations. The term Mittelstand mainly applies to mid-sized firms as opposed to larger listed companies and most importantly Mittelstand companies are characterized by a common set of values and management practices.Ludwig Erhard, the Economics Minister who crafted the post-war (West) Germany's economic miracle (German: Wirtschaftswunder) warned against reducing the Mittelstand to a mere quantitative definition, but instead emphasized more qualitative characteristics which embody the German Mittelstand, as it is "...much more of an ethos and a fundamental disposition of how one acts and behaves in society."What does define the Mittelstand, is a much broader set of values and more elastic definitions. Business historians define various traits associated with Mittelstand firms, such as:
Family ownership or family-like corporate culture
Investment into the workforce
Strong regional tiesThe latest English publication on Mittelstand firms by Prof. Bernd Venohr, Prof. Jeffrey Fear and Dr. Alessa Witt highlights that: "These companies are predominantly run by classic “owner-entrepreneurial families” (Unternehmerfamilien) seeking to sustain the business by instituting a core ideology of longevity, conservative long-term financing, and operating practices." The Mittelstand acts as a counterpoint to a singular focus on shareholder value and dispersed investor-orientated shareholding.Ordoliberalism
Ordoliberalism is the German variant of social liberalism that emphasizes the need for the state to ensure that the free market produces results close to its theoretical potential.Ordoliberal ideals became the foundation of the creation of the post-World War II German social market economy and its attendant Wirtschaftswunder.
The term "ordoliberalism" (German: Ordoliberalismus) was coined in 1950 by Hero Moeller, and refers to the academic journal ORDO.Otto von Bismarck
Otto Eduard Leopold, Prince of Bismarck, Duke of Lauenburg (Born von Bismarck-Schönhausen; German: Otto Eduard Leopold Fürst von Bismarck, Herzog zu Lauenburg; 1 April 1815 – 30 July 1898), known as Otto von Bismarck (German: [ˈɔtoː fɔn ˈbɪsmark] (listen)), was a conservative Prussian statesman who dominated German and European affairs from the 1860s until 1890 and was the first Chancellor of the German Empire between 1871 and 1890. In 1862, King Wilhelm I appointed him as Minister President of Prussia, a position he would hold until 1890, with the exception of a short break in 1873. He provoked three short, decisive wars against Denmark, Austria, and France. Following the victory against Austria, he abolished the supranational German Confederation and instead formed the North German Confederation as the first German national state in 1867, leading it as Federal Chancellor. This aligned the smaller North German states behind Prussia. Later receiving the support of the independent South German states in the Confederation's defeat of France, he formed the German Empire in 1871, unifying Germany with himself as Imperial Chancellor, while retaining control of Prussia at the same time. The new German nation excluded Austria, which had been Prussia's main opponent for predominance among the German states.
With Prussian dominance accomplished by 1871, Bismarck skillfully used balance of power diplomacy to maintain Germany's position in a Europe which, despite many disputes and war scares, remained at peace. For historian Eric Hobsbawm, it was Bismarck who "remained undisputed world champion at the game of multilateral diplomatic chess for almost twenty years after 1871, [and] devoted himself exclusively, and successfully, to maintaining peace between the powers". However, his annexation of Alsace-Lorraine gave new fuel to French nationalism and promoted Germanophobia in France. This helped set the stage for the First World War. Bismarck's diplomacy of realpolitik and powerful rule at home gained him the nickname the "Iron Chancellor". German unification and its rapid economic growth was the foundation to his foreign policy. He disliked colonialism but reluctantly built an overseas empire when it was demanded by both elite and mass opinion. Juggling a very complex interlocking series of conferences, negotiations and alliances, he used his diplomatic skills to maintain Germany's position and used the balance of power to keep Europe at peace in the 1870s and 1880s.
A master of complex politics at home, Bismarck created the first welfare state in the modern world, with the goal of gaining working class support that might otherwise go to his Socialist enemies. In the 1870s, he allied himself with the Liberals (who were low-tariff and anti-Catholic) and fought the Catholic Church in what was called the Kulturkampf ("culture struggle"). He lost that battle as the Catholics responded by forming a powerful Centre party and using universal male suffrage to gain a bloc of seats. Bismarck then reversed himself, ended the Kulturkampf, broke with the Liberals, imposed protective tariffs, and formed a political alliance with the Centre Party to fight the Socialists. A devout Lutheran, he was loyal to his king, who argued with Bismarck but in the end supported him against the advice of his wife and his heir. While the Reichstag, Germany's parliament, was elected by universal male suffrage, it did not have much control of government policy. Bismarck distrusted democracy and ruled through a strong, well-trained bureaucracy with power in the hands of a traditional Junker elite that consisted of the landed nobility in eastern Prussia. Under Wilhelm I, Bismarck largely controlled domestic and foreign affairs, until he was removed by the young Kaiser Wilhelm II in 1890, at the age of seventy-five.
Bismarck – a Junker himself – was strong-willed, outspoken and overbearing, but he could also be polite, charming and witty. Occasionally he displayed a violent temper, and he kept his power by melodramatically threatening resignation time and again, which cowed Wilhelm I. He possessed not only a long-term national and international vision but also the short-term ability to juggle complex developments. As the leader of what historians call "revolutionary conservatism", Bismarck became a hero to German nationalists; they built many monuments honoring the founder of the new Reich. Many historians praise him as a visionary who was instrumental in uniting Germany and, once that had been accomplished, kept the peace in Europe through adroit diplomacy.Social market economy
The social market economy (SOME; German: soziale Marktwirtschaft), also called Rhine capitalism, is a socioeconomic model combining a free market capitalist economic system alongside social policies that establish both fair competition within the market and a welfare state. It is sometimes classified as a coordinated market economy. The social market economy was originally promoted and implemented in West Germany by the Christian Democratic Union (CDU) under Chancellor Konrad Adenauer in 1949. Its origins can be traced to the interwar Freiburg school of economic thought.The social market economy was designed to be a third way between laissez-faire economic liberalism and socialist economics. It was strongly inspired by ordoliberalism, social democratic ideas and the political ideology of Christian democracy, or more generally the tradition of Christian ethics. The social market economy refrains from attempts to plan and guide production, the workforce, or sales, but it does support planned efforts to influence the economy through the organic means of a comprehensive economic policy coupled with flexible adaptation to market studies. Combining monetary, credit, trade, tax, customs, investment and social policies as well as other measures, this type of economic policy aims to create an economy that serves the welfare and needs of the entire population, thereby fulfilling its ultimate goal.The "social" segment is often wrongly confused with socialism and democratic socialism and although aspects were inspired by the latter the social market approach rejects the socialist ideas of replacing private property and markets with social ownership and economic planning. The "social" element to the model instead refers to support for the provision of equal opportunity and protection of those unable to enter the free market labor force because of old-age, disability, or unemployment.Some authors use the term "social capitalism" with roughly the same meaning as social market economy. It is also called "Rhine capitalism", typically when contrasting it with the Anglo-Saxon model of capitalism. Rather than see it as an antithesis, some authors describe Rhine capitalism as a successful synthesis of the Anglo-American model with social democracy. The German model is also contrasted and compared with other economic models, some of which are also described as "third ways" or regional forms of capitalism, including Tony Blair's Third Way, French dirigisme, the Dutch polder model, the Nordic model, Japanese corporate capitalism and the contemporary Chinese model. A 2012 comparative politics textbook distinguishes between the "conservative-corporatist welfare state" (arising from the German social market economy) and the "labor-led social democratic welfare state". The concept of the model has since been expanded upon into the idea of an eco-social market economy as not only taking into account the social responsibility of humanity, but also the sustainable use and protection of natural resources.Socio-Economic Panel
The German Socio-Economic Panel (SOEP [/'zœp/], for Sozio-oekonomisches Panel) is a longitudinal panel dataset of the population in Germany. It is a household based study which started in 1984 and which reinterviews adult household members annually. Additional samples have been taken of East Germans (from 1990, coincident with reunification) and immigrants (in 1994) as well as in 1998, 2000, 2002 and 2006. In 2007, there will be about 12,000 households, and more than 20,000 adult persons sampled. Some of the many topics surveyed include household composition, occupation, employment, earnings, health and life satisfaction. The annual surveys are conducted by the German Institute for Economic Research (DIW Berlin) and the Kantar Group. The survey is funded by the German Federal Government and the State of Berlin via the «Bund-Länder-Kommission» (State/Federal State Commission) for Educational Planning and Research Promotion.Data are available to social science researchers in Germany and abroad in SPSS/PSPP, SAS/DAP, Stata, R/S-PLUS and ASCII format. Extensive documentation in English and German is available online.
SOEP data are integrated into the Cross National Equivalent File (CNEF) which contains panel data from Australia, Canada, Germany, Great Britain and the United States. The data distribution of the SOEP for researchers outside of Germany is supplied with the CNEF by a group at Cornell University. Application to use this international distribution has to be made to the DIW Berlin.
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