May 2002 - Nr. 5
More and More, Germany Is the Place to Do Business
TWIG - According to a study conducted by the U.S. accounting firm Ernst & Young, foreign investors are being drawn in growing numbers to Germany. The Federal Republic’s share of all foreign direct investment (FDI) increased from 9% to 10% in 2001 - the only European country to gain share last year. Overall, FDI in Europe contracted by 12% last year, a trend Germany bucked by posting its 1% gain. The United States remained the biggest investor, followed by Germany itself. Despite stagnating technology markets, software sector investments still accounted for the greatest portion of FDI. As Europe’s largest economy, and in light of the EU’s eastward expansion, Germany is particularly well positioned as a business and travel hub. "Germany is prized for its high-quality infrastructure and reliable legal system," said Ernst & Young manager Karl Hamberger. Disadvantages cited by the study were the relative inflexibility of the labour market and high wages. Among the ten best areas for investment in Europe, two are in Germany: the Darmstadt region of Hessia (No. 5) and Bavaria (No. 7); London, England retained its No. 1 ranking.
