SHAPE SHAPE SHAPE

for a number of years. Daimler has its
headquarters here, as do sap and Bosch,
but many small and medium-sized companies
in the electrical, engineering,
chemistry and it industries have enjoyed
amazing success. A new exhibition center
recently opened next to the airport, and
by September it was already fully booked
through Christmas.
“ Germans are
feeling a new sense
of pride about
their country.”
The rules for how research funds are
allocated among the different states were
recently changed. Competition has intensifi
ed, and the latest allocations resulted
in the eastern states receiving no funding
at all while Baden-Württemberg and
Bavaria wound up with the bulk of the
money. This will naturally favor southern
Germany even more.
Bavaria and Baden-Württemberg compete
not just economically, but also in the
entertainment fi eld. Munich has its Oktoberfest,
but Stuttgart has the Cannstatter
Volksfest, a beer festival that is almost as
large. When the last beer was poured on
the evening of October 14, a record 4.5
million visitors had attended the festival
– yet another sign that times are good.
On October 3, 1990, the German
Democratic Republic ceased to exist, and
the Federal Republic of Germany now
consists of 16 states. Integrating the eastern
states into the Federal Republic is still
a costly process. Dizzying sums, over a
trillion euros, have been invested in unifying
the country so far, but unemployment
in the former East Germany is still
twice as high as in the west.
“People living in the west like to say
they feel solidarity with the east, but they
can’t understand why it’s taking so long,”
says Mai-Brith Schartau, a professor at
Södertörn University College.
However, Heinemann of the Centre
for European Economic Research doesn’t
think the differences between east and
west or between north and south will
grow. “The eastern states are catching
up to the rest of Germany, although it’s
going very slowly,” he says.
Despite major regional differences
and an international economy that has
been shaky this year, things are going
well for Germany as a whole. After a
number of years of stagnation and annual
gnp growth between 2001 and
2005 of only about 0.7 percent, gnp in
2006 rose a healthy 2.2 percent over the
previous year.
Nonetheless, Heinemann is concerned
that the government has lately expressed
a willingness to backtrack on the extensive
reforms carried out in the labor market,
pensions and taxes. “That may have
In September
2007, unemployment
in Germany
was 8.4 percent.
The lowest rate,
2.7 percent, was in
Biberach district,
Baden-Württemberg,
and
the highest was
in Uckermark,
Brandenburg, in
the former East
Germany, 21.1
percent.
adverse effects on the economy, not immediately,
but over the medium term,”
he says.
GERMANY HAS A STRONG reputation
as an industrial nation with large companies
like Siemens, bmw, Daimler, Bayer,
basf and sap. But the country also has
many mid-sized and smaller industries.
Like other industrial nations, Germany
has undergone numerous restructurings,
but the industrial sector still constitutes
the backbone of the German economy.
Germany has enormous exports, almost
one trillion euros, and has been described
as an “export champion.” Roughly onethird
of gnp goes to exports. Baden-
Württemberg is the state that is most de-
UNEMPLOYMENT IN GERMANY’S FEDERAL STATES (percent)
Schleswig-
Holstein
7.8
Mecklenburg-
Vorpommern
Hamburg 14.8
Bremen
HAMBURG
8.7
BREMEN
12.3
Niedersachsen
8.4
HANNOVER
Berlin
BERLIN
14.9
DORTMUND
North Rhine-Westfalen
9
BONN
Thüringen
12.1
Hessen
7.2
FRANKFURT
Rhineland-Palatinate
6 KAISERSLAUTERN
Saarland
8.1
NUREMBERG
Baden-Württemberg
4.7
STUTTGART
Saxony-Anhalt
15
Bavaria
4.8
MUNICH
Brandenburg
13.8
LEIPZIG
Saxony
13.9
[4*2007] SHAPE SCA*13
▲
SOURCE: STATISTIK DER BUNDESAGENTUR FÜR ARBEIT - STAND SEPTEMBER 2007 (DZ/AM)