Economy - overview In 1997 the German economy, the world's third most powerful, benefited from robust exports, particularly to other members of the EU and the US, as well as strengthening equipment investment. But anemic private consumption and a contraction in the construction industry limited the expansion. Unemployment continued to set post-war monthly records through the end of 1997 and averaged 4.3 million for the year. In preparation for the 1 January 1999 start of the European Monetary Union, the government has made major efforts in 1996-97 to reduce the fiscal deficit. This effort has been complicated by growing unemployment, an erosion of the tax base, and the continuing transfer of roughly $100 billion a year to eastern Germany to refurbish this ex-communist area. In recent years business and political leaders have become increasingly concerned about Germany's decline in attractiveness as an investment target. They cite increasing preference by German companies to locate new manufacturing facilities in foreign countries, including the US, rather than in Germany, to be closer to the markets and to avoid Germany's high tax rates, high wage costs, rigid labor structures, and extensive regulations. For similar reasons foreign investment in Germany has been lagging in recent years.

GDP purchasing power parity - $1.74 trillion (western: purchasing power parity - $1.60 trillion; eastern: purchasing power parity - $144 billion) (1997 est.)

GDP - real growth rate 2.4% (western 2.5%, eastern 1.7%) (1997 est.)

GDP - per capita purchasing power parity - $20,800 (western: purchasing power parity - $23,600; eastern: purchasing power parity - $9,100) (1997 est.)

GDP - composition by sector
agriculture: 1.1%
industry: 34.5%
services: 64.4% (1995)

Inflation rate - consumer price index 1.8% (1997)

Labor force
total: 38.7 million
by occupation: industry 41%, agriculture 3%, services 56% (1995)

Unemployment rate 12% (1997 est.)

Budget
revenues: $755 billion
expenditures: $832.1 billion, including capital expenditures of $NA (1995)

Industries western: among world's largest and technologically advanced producers of iron, steel, coal, cement, chemicals, machinery, vehicles, machine tools, electronics, food and beverages; eastern: metal fabrication, chemicals, brown coal, shipbuilding, machine building, food and beverages, textiles, petroleum refining

Industrial production growth rate 3% (1997)

Electricity - capacity 109.727 million kW (1995)

Electricity - production 495.875 billion kWh (1995)

Electricity - consumption per capita 6,154 kWh (1995 est.)

Agriculture - products western: potatoes, wheat, barley, sugar beets, fruit, cabbage; cattle, pigs, poultry; eastern: wheat, rye, barley, potatoes, sugar beets, fruit; pork, beef, chicken, milk, hides

Exports
total value: $521.1 billion (f.o.b., 1996)
commodities: manufactures 88.2% (including machines and machine tools, chemicals, motor vehicles, iron and steel products), agricultural products 5.0%, raw materials 2.3%, fuels 1.0%, other 3.5% (1995)
partners: EU 57.7% (France 11.7%, UK 8.1%, Italy 7.6%, Netherlands 7.5%, Belgium-Luxembourg 6.5%, Austria 5.5%), Eastern Europe 8.0%, other West European countries 7.5%, US 7.3%, NICs 5.6%, Japan 2.5%, OPEC 2.2%, China 1.4% (1996 est.)

Imports
total value: $455.7 billion (f.o.b., 1996)
commodities: manufactures 74.2%, agricultural products 9.9%, fuels 6.4%, raw materials 5.9%, other 3.6% (1995)
partners: EU 55.5% (France 10.8%, Netherlands 8.6%, Italy 8.4%, Belgium-Luxembourg 6.6%, UK 6.4%, Austria 3.9%), Eastern Europe 8.7%, other West European countries 7.2%, US 6.8%, Japan 5.3%, NICs 5.3%, China 2.4%, OPEC 1.7%, other 7.1% (1995)

Debt - external $NA

Economic aid
donor: ODA, $9 billion (1996 est.)

Currency 1 deutsche mark (DM) = 100 pfennige

Exchange rates deutsche marks (DM) per US$1 - 1.8167 (January 1998), 1.7341 (1997), 1.5048 (1996), 1.4331 (1995), 1.6228 (1994), 1.6533 (1993)

Fiscal year calendar year

NOTE: The information regarding Germany on this page is re-published from the 1998 World Fact Book of the United States Central Intelligence Agency. No claims are made regarding the accuracy of Germany Economy 1998 information contained here. All suggestions for corrections of any errors about Germany Economy 1998 should be addressed to the CIA.