Direct investments from abroad: Berlin heads German city rankings

Berlin's economic boom is to continue for the rest of the year. Investitionsbank Berlin (IBB) expects the federal capital's economic growth figures for the third quarter to show a 2.5% increase over the same period in 2014. If correct, this means that Berlin would outperform the forecast for Germany as a whole. According to IBB, the main driver behind the positive economic figures is the performance of the retail sector, with strong population growth, the continuing influx of tourists and real salary increases creating a healthy consumer climate. However, direct investment from abroad is also breathing wind into the sails of the Berlin economy, as can be seen from a recent survey published by the consultancy firm, EY, which revealed that no fewer than 80 foreign investment projects were launched in Berlin last year - that's 220 per cent more than in 2013 when the total was just 25 projects - making Berlin the most successful city in Germany. In 2014 no other city attracted as many foreign companies to locate within its boundaries. Runner-up was Frankfurt am Main with 69 direct investments from abroad, followed by Düsseldorf with 50.

Berlin - higher growth in direct investment than any other German state

No other German state was as successful as Berlin last year in growing its direct investment levels from abroad. The capital rose to fourth place in the "league table" of German states in 2014. Baden-Württemberg was top (224 direct investments), Hesse second (129) and North Rhine-Westphalia third (126). Berlin even managed to overtake Bavaria which attracted 71 foreign companies to locate within its boundaries last year. And Berlin is now up there with other European cities, with only London and Paris attracting more direct investment from abroad last year than the German capital. Many investors now regard Germany as the best country to invest in. No fewer than five Germany cities made it into the European Top 20 - more than from any other European country.

Berlin - 1,595 new jobs created by foreign companies locating in the capital

US companies are way ahead of the field when it comes to investing in Berlin. Of the 80 direct investments from abroad last year, a massive 26 came from US companies. China and the UK occupied joint second place with seven company locations each.
The high number of direct investments from abroad has also had a positive effect on Berlin's employment market, creating no fewer than 1,595 new jobs last year, and taking Berlin to third place in a comparison of German states, behind North Rhine-Westphalia (+ 2,613 jobs) and Baden-Württemberg (+ 1,607 jobs). Overall, some 765 foreign companies located in Germany last year - up nine per cent on the previous year's figure. And the number of jobs created throughout the country as a whole rose by the same percentage amount to 11,327.

Foreign investors regard Berlin as the most attractive city in Germany

In addition to compiling actual direct investment figures, the experts also surveyed the image of individual German states, asking 808 executives and 202 managers of internationally active companies for their opinions. Here too, Berlin has its nose in front. For investors who do not carry out any business activities in Germany, the capital is the most attractive place in Germany for them to locate in. Those investors who do have business activities in Germany put Berlin in second place behind Bavaria. There are many reasons why Berlin is so attractive: rents and salaries are still regarded to be relatively favorable, and the city has a strong international vibe which appeals to investors with a young, creative focus.