Berlin has been able to hold its ground as a competitive business location. The city’s outstanding infrastructure, its large and highly qualified workforce, and its excellent colleges, universities, and research institutions are major reasons motivating companies to locate here. Once an industrial city, Berlin is on the way to becoming a modern center of service providers. One important business sector is tourism. Berlin chalked up yet another record in 2007: with 17.29 million overnight stays and around 7.59 million hotel guests from Germany and abroad, the numbers for 2007 have outstripped those for 2006, itself a record year for tourism. The increase in overnight stays to 17.29 million represents growth of 8.6 percent.
In the last 15 years, Berlin’s economy has undergone fundamental structural change.The growth of the service sector has gone hand in hand with a decline in industry and construction. Today Berlin and the area surrounding it boast many strong companies. This development was assisted by significant funding from the European Structural Funds used to target the economy and infrastructure. We received almost €1.3 billion in the six-year funding period that ended in 2006, and roughly the same amount has been made available in the current funding period, which runs till 2013.
Our economic structure
Small and medium-size companies are key to Berlin’s economy. Despite substantial job cuts, Berlin still has a strong industrial core: around 96,000 people worked at manufacturing companies with 20 or more employees in 2006. Exports, which grew by around 38 percent between 2000 and 2006, underscore the productivity of Berlin’s industry. Along with electrical engineering, food products, chemicals, mechanical engineering, and motor-vehicle manufacturing are some of Berlin’s traditionally strong sectors. In addition to construction and the skilled trades, which are usually organized in small businesses, trade and services also play a major role. In 2006, Berlin’s trade sector included a total of almost 70,000 large and small businesses employing around 186,000 people.
The founding of new businesses continues unabated in Berlin. The difference in the number of businesses registered and those de-registered shows that the number of start-ups continued to grow in 2006, with a net total of 13,000 new businesses for that year. The private service sector has generated more than 100,000 new jobs in the last ten years. Including the areas of trade, banking, and insurance, as well as transportation and communications, more than 50% of the people employed in Berlin work in the private service sector. In this sector the overall total comes to around 720,000.
The scientific and academic landscape
In order to secure its position over the long term as a location for business, Berlin will have to prioritize the acquisition of competence in forward-looking sectors. The prerequisites are already in place. One positive legacy of the city’s years of division is Berlin’s outstanding academic, scientific, research, and development landscape: for political reasons, both West German governments and the GDR had concentrated scientific and academic potential in Berlin. As a result, Berlin has a wide range of colleges and universities and many research institutions.
Politics and the economy
Bolstering the economy and creating an environment conducive to investment and economic expansion are among the state’s key tasks. Berlin is investing great effort in bringing modern, competitive industrial production facilities to the city, not least as an anchor for the growing sector of production-related services. The Senate provides support to promising new businesses and sector-specific technology and start-up centers. Policies promote both existing businesses and investment in the modernization of business-related infrastructure. Priorities include boosting innovative capacity by creating networks and disseminating technology, as well as assisting small and medium-sized businesses, since these play a key role in the creation of new jobs.
Support for investors
As part of its strategy, Berlin will be concentrating even more than in the past on promoting cooperation between business and science. Activities focus on transportation technology, biotechnology and medical technology, and information technology and media, all of which are fields of the future.Berlin Partner GmbH offers potential investors all the services they need from a single source. It answers questions about the city as a business location, helps with the search for land and office space, provides competent information about foreign markets, and helps investors locate cooperation partners. Companies can also take advantage of the Investor Service Agency (ZAK) whenever they need help with permit or administrative procedures.