Economy - overview Germany, the world's third-most powerful economy, is gearing up forthe European Economic and Monetary Union in 1999. One key economic priorityis meeting the Maastricht criteria for entry into EMU, a goal complicatedby record unemployment and stagnating growth. The government has implementedan austerity budget in its attempt to get the deficit down to 3% of GDP asrequired by Maastricht, but further cuts probably will be necessary and thereis little consensus among the parties or elites about next steps toward thatend. In recent years business and political leaders have become increasinglyconcerned about Germany's apparent decline in attractiveness as a businesslocation. They cite the increasing preference of German companies to locatenew manufacturing facilities - long the strength of the postwar economy -in foreign countries, including the US, rather than in Germany, so they canbe closer to their markets and avoid Germany's high taxes and labor costs.At the same time, Germany faces its own unique problem of bringing its easternarea up to scratch after 45 years of communist rule. Despite substantial progresstoward economic integration, the eastern states will continue to rely on theannual subsidy of approximately $100 billion from the western part into thenext century. Assistance from the west helped the east to average nearly 8%annual economic growth in 1992-95, even though the overall German economyhad averaged less than 2% growth; growth in the east, however, tumbled to2% in 1996, with unemployment a particularly severe problem.

GDP purchasing power parity - $1.7 trillion (western: purchasing power parity- $1.56 trillion; eastern: purchasing power parity - $142 billion) (1996 est.)

GDP - real growth rate 1.4% (western 1.3%, eastern 2.0%) (1996)

GDP - per capita purchasing power parity - $20,400 (western: purchasing power parity- $23,100; eastern: purchasing power parity - $9,000) (1996 est.)

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

Inflation rate - consumer price index 1.5% (1996)

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

Unemployment rate 10.8% (western 9.6%, eastern 15.9%) (December 1996)

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

Industries western: among world's largest and technologically advanced producersof iron, steel, coal, cement, chemicals, machinery, vehicles, machine tools,electronics, food and beverages; eastern: metal fabrication, chemicals, browncoal, shipbuilding, machine building, food and beverages, textiles, petroleumrefining

Industrial production growth rate 1.3% (1996 est.)

Electricity - capacity 109.73 million kW (1994)

Electricity - production 529.1 billion kWh (1995)

Electricity - consumption per capita 5,727 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: $501.3 billion (f.o.b., 1996 est.)
commodities: manufactures 88.2% (including machines and machine tools, chemicals,motor vehicles, iron and steel products), agricultural products 5.0%, rawmaterials 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-Luxembourg6.5%, 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. for first10 months)

Imports
total value: $430.7 billion (f.o.b., 1996 est.)
commodities: manufactures 74.2%, agricultural products 9.9%, fuels 6.4%, raw materials5.9%, other 3.6% (1995)
partners : EU 55.5% (France 10.8%, Netherlands 8.6%, Italy 8.4%, Belgium-Luxembourg6.6%, UK 6.4%, Austria 3.9%), Eastern Europe 8.7%, other West European countries7.2%, 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 - 1.6043 (January 1997), 1.5048 (1996),1.4331 (1995), 1.6228 (1994), 1.6533 (1993), 1.5617 (1992)

Fiscal year calendar year

NOTE: The information regarding Germany on this page is re-published from the 1997 World Fact Book of the United States Central Intelligence Agency. No claims are made regarding the accuracy of Germany Economy 1997 information contained here. All suggestions for corrections of any errors about Germany Economy 1997 should be addressed to the CIA.