Your company is already operating in Germany and you would now like to export worldwide?

Skyline cityscape of Frankfurt, Germany during sunny day. Frankfurt Main in a financial capital of Europe Skyline cityscape of Frankfurt, Germany during sunny day. Frankfurt Main in a financial capital of Europe. | © Nikolay N. Antonov - stock.adobe.com

Investment Environment

The German Market - Europe’s Economic Hub

Germany is Europe's best performing economy. Small and medium-sized enterprises drive the market and dynamic trade relationships within Europe and beyond offer plenty of business opportunities.

Germany's economic policies enhance a broad and competitive industrial environment with a strong focus on innovative future technologies. Many small and medium sized enterprises utilize this potential, making them leaders in their respective markets. Across industries large and small, German products are worldwide export hits.According to recent studies, Germany ranks as the top investment location in Europe. Along with its relative economic stability, Germany is the largest domestic market within Europe, creating a large and stable customer base for investors. Germany's integration into the world economy also allows companies to gain and share knowledge, products and employees within a global network.

Biggest Market at the Heart of Europe

Germany is the largest market in Europe. It constitutes 25 percent of Europe's GDP (EU-27) and is home to 19 percent of the total European Union (EU) population.

The German economy is both highly industrialized and diversified – with equal focus placed on services and production.

Share of Total GDP and Population in the European Union 2020
GDP
(in EUR tr)
Share of Total GDP (EU 27)

Population

(in m)

Share of Total Population (EU 27)
Germany3.325%8319%

France

2.3

17%

67

15%

Italy

1.7

12%

60

13%

Spain

1.1

8%

47

11%

Netherlands

0.8

6%

17

4%

Poland

0.5

4%

38

8%

Czech Republic

0.2

2%

11

2%

EU 27

13.3

100%

447

100%

USA

17.1

328

China

12.0

1,398

Japan

4.1

126

UK

2.2

67

Source: Eurostat, World Bank 2021

Key Driver: The Manufacturing Industry

Ten percent of Europe's manufacturing companies are German. They generate more 30 percent of the EU's gross value added in the manufacturing sector alone. In fact, they represent more than one fifth of all of Germany's value added – one of the highest shares in Europe. Increasingly more foreign companies are placing their faith in Germany as an essential location for production sites and are benefiting from the country's excellent business framework and superior productivity rates.

Economic Backbone: Small and Medium-Sized Enterprises

Exports are driven by Germany’s backbone of highly innovative small and medium-sized enterprises (SMEs). These constitute more than 99.3 percent of all companies that employ 55 percent of all employees in Germany. Many of these SMEs are world market leaders in their respective niche segments. Together with internationally leading companies - such as Bayer, BASF, Daimler, Volkswagen, and Siemens to name but a few - they make up Germany’s manufacturing industrial base.

Company Structure in Germany (2019)


Total

SMEs

SME-Share

Number of Companies *

3.56  m

3.54 m

99.3%

Turnover of Companies *

EUR 7,153  bn

EUR 2,353  bn

32.9%

Employed *

35.21 m

19.24  m

54.7 %

Net Value-Added **

60.6 %

Source: Ifm Bonn, 2021

All figures relate to the private sector (commercial business economy and the liberal professions without public sector, NACE Rev. 2 Codes A-N,P-S). Exceptions are marked.
* Figures provided by the business register (NACE Rev. 2 Codes B-N,P-S). Differentiation of SMEs by number of employees and turnover
** Estimates by the IfM Bonn. Basic data: turnover tax statistics (VAT). Differentiation of SMEs by turnover 

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