International Business Opportunities In Germany

INTERNATIONAL BUSINESS OPPORTUNITIES IN GERMANY

Executive Summary

This paper examines the opportunity for international business in Germany. It reviews Germany's history, demographics, political and economic structure in regards to how they support or do not support an environment that nurtures international business opportunities. Additionally a review of Germany's attitude towards foreign direct investment, its participation as a member of the World Trade Organization as well as economic conditions such as stability of its currency, gross national product, balance of trade, national budget, inflation and level of foreign debt was completed. Collectively, these factors led to gauging the level of opportunity for international business in Germany as favorable; its government and industry encourage foreign direct investment and have eased, if not eliminated, much of the red-tape that can be associated with foreign direct investment. Free movement of capital between the U.S. and Germany and over 3000 incentive programs offered by federal and state authorities to U.S. investors lend additional support to this conclusion. Industry sectors offering opportunity for international business in Germany include computer software, management consulting services, drug & pharmaceuticals, and telecommunication equipment. Potential success in these sectors can be derived from the availability of a highly skilled and productive worker force, currency stability, political stability, absence of corruption and Germany's prime location in the heart of Europe.

OUTLINE

Introduction: Gauging the International Business Climate in Germany

I. Review of Key Data

A. History

1. Early History

2. Germany Today

B. Geography

C. Population Demographics

1. Education Levels

2. Religious Beliefs

3. Political Conditions

D. Cultural Factors

1. Language

2. Decision Making Styles

3. Working Practices

II. Support of International Business Initiatives

A. Economic Integration & Foreign Direct Investment

1. Driving Force

2. Legislation and Incentives

C. World Trade Organization Membership

1. Inaugural Member

2. Recent Activities

III. Economic Environment

A. Currency

B. Gross National Product

C. Balance of Trade

D. Level of Inflation

E. Foreign Debt Obligations

Conclusion: Identification of Business Opportunities Supported by Germany's International Business Environment

International Business opportunities in Germany

Introduction

To identify and gain an understanding of the environment for international business in Germany, several factors will be reviewed. A country's history, geography, culture, population demographics as well as political and economic structure can all play a role in either contributing to or working against the existence of a climate favorable to international business. By examining issues such as Germany's participation in area economic integration, its attitude toward foreign direct investment and its participation in the World Trade Organization, a favorable or unfavorable environment towards international business can be identified. Once the climate has been identified as favorable to international business, a second tier of review is conducted to identify those areas of business which present the best opportunity for success and the factors supporting their success.

Germany's History

Germany is believed to have been inhabited as early as the second century, first by the Celts followed by various German tribes. One of the tribes, the Franks, ruled Germany until the fourteenth century when rule came under the jurisdiction of the Holy Roman Empire. The Thirty Years' War from 1618-1648 devastated Germany and broke it into hundreds of small principalities independent of the emperor.

The Federal Republic of Germany has been influenced over the years by many historical events, including World War I and II, the Weimar Republic, Hitler's reign as Chancellor during the era of National Socialism, and the Blockade of Berlin in 1948. Most recently, Germany experienced a Reunification of East and West Germany beginning in 1989. The falling of the Berlin Wall in 1989 was a cornerstone to the development of Germany's current economic and business environment. (Facts About Germany)

The structure of Germany before the fall of the Berlin Wall consisted of two states, East and West Germany. East Germany was characterized by communism and repression, whereas

West Germany enjoyed a social economic system, freedom and safety. The division of the two states occurred in1949 following the Cold War. Both states attempted to claim title for a political and economic model that would be suited for a combined Germany.

Eastern Germany at the time was known as the German Democratic Republic (GDR). Over the years, despite the vast propaganda of the GDR, the citizens of East Germany continued to find ways to leave and flee for West Germany. Citizens of the GDR organized mass protests while they experienced depleted resources and loss of productivity. The revolution occurring in the GDR eventually let to the opening of the border crossing in Berlin in 1989

Germany's Geography

Germany is one of the most densely populated countries in the world, with almost 83 million people inhabiting 357,022 square kilometers of land. The country consists of 16 federal states and 32 kingdoms, principalities and