Germany - country profile, economics and technology issues

Freigegeben in point of view

As background to our global macro services, thinking and publications Iceventure provides a country overview page about Germany.

Classification of Germany

Germany is the 5th largest economy and largest economy in Europe. The GPD in 2019 (nominal) was 3.435 Trillion EUR.
It is an attractive market for companies.
 

Economic and political issues in Germany

As primarily export driven country it is an outlier in global economics. The clear strength of Germany

in industrial products, cars and manufacturing is an advantage and a weakness at the same time.
Currently, Germany runs a double social experiment changing its energy supply to green and enable emobility at the same time putting substantial pressure on budgets and industries.
Germany is not considered to be a leading force in digitalization.

Eurozone

Germany is a dominant country in the Eurozone and a net contributor. With regards to the Euro German politics strongly advocates budget control, spending controls and has a no-Eurobond policy in place.
As anchor wage setter it furthermore influences the Eurozone strongly.
The positions put pressure on the weak architecture of the Euro, a fixed exchange rate regime, not an OCA.
At the same time, real analytics show that Germany was hit quite hard by the Euro crisis. A little-known fact: The biggest bad bank in Europe is located in Germany.

Trends to watch

Germany's leading position as export country may be challenged or transformed by the post-covid slowdown and the relocalization of global supply chains.
The German automotive industry is transforming its production scope and market range. New products, models and markets are in development, though not all will succeed. The gains and benefits in this industry are still unclear; to get a clear picture, strong analytics are necessary.
The political landscape in Germany has changed since the rise of the AFD. Centrist parties are stagnating or receding while the political edges gain influence. This increases the dynamism and reduces, to some extent, the predictability of economic and other policies. This poses a challenge to modelling and predictive efforts for companies.

Technology

Germany has strong conventional industrial technologies: Automotive, mechanical engineering, as well as chemical production are well-developed and highly productive. In the area of high technology, the pharma sector is also strong.
However, many questions remain in digital technologies. Both production and use of digital processes are underdeveloped. In particular, the tech sector of digital business models is lagging behind. This is strange, considering the possibility of emerging industry data models.

There are many opportunities and challenges on a macroeconomic, political, and technological levels. Iceventure provides the analytics needed to navigate this market.

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