APO AE 09080
telephone: [49] (228) 3391
FAX: [49] (228) 339-2663
branch office: Berlin
consulate(s) general: Frankfurt, Hamburg, Leipzig, Munich, and
Stuttgart

Flag: three equal horizontal bands of black (top), red, and yellow

@Germany:Economy

Overview: Five years after the fall of the Berlin Wall, progress
towards economic integration between eastern and western Germany is
clearly visible, yet the eastern region almost certainly will remain
dependent on subsidies funded by western Germany until well into the
next century. The staggering $390 billion in western German assistance
that the eastern states have received since 1990 - 40 times the amount
in real terms of US Marshall Fund aid sent to West Germany after World
War II - is just beginning to have an impact on the eastern German
standard of living, which plummeted after unification. Assistance to
the east continues to run at roughly $100 billion annually. Although
the growth rate in the east was much greater than in the west in
1993-94, eastern GDP per capita nonetheless remains well below
preunification levels; it will take 10-15 years for the eastern states
to match western Germany's living standards. The economic recovery in
the east is led by the construction industries which account for
one-third of industrial output, with growth increasingly supported by
the service sectors and light manufacturing industries. Eastern
Germany's economy is changing from one anchored on manufacturing to a
more service-oriented economy. Western Germany, with three times the
per capita output of the eastern states, has an advanced market
economy and is a world leader in exports. The strong recovery in 1994
from recession began in the export sector and spread to the investment
and consumption sectors in response to falling interest rates. Western
Germany has a highly urbanized and skilled population that enjoys
excellent living standards, abundant leisure time, and comprehensive
social welfare benefits. It is relatively poor in natural resources,
coal being the most important mineral. Western Germany's world-class
companies manufacture technologically advanced goods. The region's
economy is mature: services and manufacturing account for the dominant
share of economic activities, and raw materials and semimanufactured
goods constitute a large portion of imports.

National product:
Germany: GDP - purchasing power parity - $1.3446 trill