Germany Economy
Reunification was a crucial moment for the economic history of Germany, not only for its historical importance but also for what it entailed from the point of view of territorial integration, infrastructural adaptation, productive reconversion, expansion of the internal market, social issues, control of unemployment and migratory flows, environmental problems. The parallel management of all these problems would quickly lead to the collapse of economic systems less efficient than the German one. It was in fact necessary to absorb in the most advanced economy of Europe a territorial area as large as an entire state, with an income of approx. half that of the West, a technological and industrial delay of years, insufficient infrastructure and credit system, a dramatic environmental situation, a monetary system to be reconverted. For many countries it would have meant the abyss, instead the German nation has been able to tackle the question, relying on the proverbial efficiency of its production machine, on commercial initiative, on the management capacity that had already led it in the course of its history to the top of world economy. According to smber, the first choice was to prefer the way of state indebtedness to that of the tax burden on citizens; consequently, the fundamental points of the German action were: the closure of the most backward plants in the eastern area; the reconversion and updating of the main production poles, especially through the massive investment by Western companies; privatization and concentration of companies and state ownership; the opening of construction sites for public works, to create jobs by giving a new face to eastern cities; the recovery of infrastructures (from communication routes to telecommunications), to reunite even physically two areas of Europe that remained isolated for forty years. Financial capital (both expressed by the German system and from abroad) played a decisive role in supporting this effort, but above all the ability with which Germany was able to derive from the fall of the communist bloc and the birth of new nations in the Eastern Europe, new opportunities for economic expansion. In fact, a decisive role in the economic path taken by the country in Czech Republic, Slovakia, Poland, the States born from the disintegration of the former Yugoslavia, the Baltic Republics), for which it, partly replacing the GDR, partly in a new guise, has become the preferential interlocutor of the dialogue with the West, from the point of view both political, and above all commercial; this allowed Germany to further expand its advanced productions, while also managing to exploit and place on the market a part of those partly backward products made by the Eastern industry.
However, the difficulties were neither small nor few from the start: the need to unify the monetary systems caused a sudden increase in inflation, which had long been very modest on the West German scene, while public financing for the reconversion of East expanded the state budget deficit to such an extent that Germany’s membership of the European Monetary Union was called into question, requiring a certain increase in the public debt. The countermeasures adopted to restrict spending and monetary circulation had the effect of depressing the start of recovery in the eastern regions (where construction, driven by public contracts, was taking the place of downsized manufacturing activities), a reduction in consumption domestic, a re-appreciation of the mark on the foreign exchange market (which led to a loss of competitiveness of German exports). Serious problems persist after more than a decade on the front of the territorial distribution of wealth: the standard of living of the residents of Länder Oriental people did not achieve the desired results and their income is still significantly lower than that of citizens of the West, which has given rise to understandable social unrest, as well as insinuating a certain impatience even in the residents of the western areas, fearful of duty keep the poorest compatriots with their own incomes. In fact, if the growth rate of the eastern regions has been extraordinarily high for some time, and if in the following years, although declining, it appears higher than that of the western regions, the phenomenon is simply due to the lower level of development which the eastern regions have taken on. Nevertheless, despite the numerous difficulties, the slowdown in growth and the still partial state of the results achieved, Germany’s international economic role has never really been questioned: third world power for wealth produced, its weight on the international scene has indeed expanded, both by incorporating the production made in the East and by opening up to the new customers mentioned above. It can therefore be said that in this emergency situation Germany has once again demonstrated that it possesses a production structure capable of guaranteeing excellent performance even in moments of contingent difficulties, especially in consideration of the fact that at the same time as the recovery of the East the country did not never stopped carrying on the process of consolidating the European Union indeed, he is one of the main supporters. Its traditional strong points are metallurgy, mechanics, electrical engineering, chemistry, textiles and, more recently, also electronics, electrical engineering, clothing, food. Furthermore, the country is well supported by an efficient system of public and private services which constitute a fundamental support for production and internal and foreign trade. The latter is traditionally one of the strengths of the German economy, which controls about one sixth of the volume of trade that takes place on a world scale. With reference to the whole set of economic (and non-economic) activities, the great capacity of the training system to prepare qualified personnel and to organize and finalize basic and applied research (from which derives a very high number of process and product innovations) should be remembered. These characteristics have allowed united Germany to maintain the leading role it deserves in the world economy, even if the “locomotive of Europe” has been heavily affected by the effects of the negative economic situation that has affected the international market since the end of 2001. The persistence of stagnation, combined with the monetary conversion following the entry into force of the euro (January 2002) caused a notable slowdown in economic growth, which in the transition between 2002 and 2003 even came to a halt. In fact, in 2008 GDP stood at US $ 3,667,513 million, a value similar to that of the previous year, and this slowdown contributed to aggravate the situation of the public deficit, which exceeded the 3% threshold provided for by the pact of stability of the EU.
