INVESTING IN GERMANY
Is investing in Germany something you are considering? If so, BDG would be delighted to assist. Read on to find out more about investing in Germany for expats from our brief overview. This will cover the benefits, risks and advice you ought to take on board whether you are planning on investing in stocks in Germany or investing in real estate in Germany. Of course, you can always contact us for more specific support about investing in Germany, too!
BENEFITS
There can be little doubt that investing in Germany offers the benefit of a central European location and of top-notch innovation, something that many foreign business people and expats alike would agree on. Today, numerous overseas businesses want to make further investments in Germany. The latest statistics demonstrate that Germany attracts numerous foreign investors. Indeed, in recent years, investing in Germany for expats has become even more pronounced. Non-German nationals have invested greater sums in Germany than in previous years. To be clear, over one-third of the total investment turnover was accounted for by foreign investors.
Germany has become the biggest national economy in Europe thanks to its high levels of industrialization. Indeed, it is now the fourth-largest economy globally. A leader in technological advancements, Germany boasts the second-highest export trade figures in the world. As such investing in Germany for expats is often as much about investing in the world economy as it is about Germany’s. Please note that 37 of the world’s 500 top listed corporations are incorporated in the country. These companies are underpinned by a very predictable German economy that makes investing in stocks in Germany increasingly attractive.
It should also be noted that belonging to the European Union has meant that Germany has become even more competitive internationally. This is not only by comparison to other industrialized countries but among other EU member states, too. The numerous economic upsides of the trading bloc are another reason why investing in Germany for expats has become so popular.
Germany also benefits from a well-structured educational system. This helps to produce a very skilled workforce that businesses can take advantage of. Generally speaking, the country's workforce is both highly motivated and well-educated. There again, there is a business-friendly tax regime in Germany. Much of the country's commercial infrastructure offers the sort of thing that attracts international commercial investors whether they are investing in stocks in Germany or opting for other sorts of investments.
Germany’s tax code is simple and something that everyone can follow. Consequently, Germany is an appealing investment prospect for both overseas individuals and foreign businesses alike. The tax laws are friendly toward investors for a sound reason – tax policies have been geared up to promote investment for decades. This is something that most people discover when they are investing in real estate in Germany as well as making investments in German businesses.
Another benefit of investing in Germany for expats is that there are some prime locations for investments to take place. Collectively known as the 'Big Six', these are Germany's major cities - Frankfurt, Hamburg, Cologne, Düsseldorf, Munich and the country's capital, Berlin. On their own, they account for well over half of all of the country's yearly investments. For any commercial entity considering investing in Germany, these cities offer a stable local economy.
ADVICE
Business investors ought to seek expert guidance whether they plan on investing in real estate in Germany or want to purchase stocks. When starting their business activities, the distinctive business culture in the country means that professional advice can be invaluable, not least because of the legal framework for investments.
BDG’s global business contacts coupled with its direct access to decision-makers allow us to help when investing in stocks in Germany or making real estate investments. We offer a proven track record of helping overseas firms to enter the German market successfully and to establish a secure commercial presence. We also help our clients to manage potential language barriers so that they can fully understand the business and administrative cultures when investing in real estate in Germany, for example.
By providing contact with key decision-makers and offering a network of investment opportunities, BDG is also in a position to act as an intermediary between international investment agencies and the German investment market. Our wealth of knowledge in the German market means we can answer questions from investors fully while also responding to their particular interests.
RISKS
For expats and others, investing in Germany is not without risk. Therefore, gaining an equitable view of risk versus reward should be a priority for any investor. Bear in mind that although Germany has a strong economic outlook, it would not be wise to fail to take into account all the problems that the country faces. For instance, Germany’s EU membership has caused some recent challenges, notably the sovereign debt crisis in Europe, despite its undoubted upsides.
Furthermore, the potential for ‘contagion’ from a failing economy in the EU spreading to Germany should not be ruled out. What if one state’s failure to service its debt could cause a domino effect among its neighbours? This would inevitably result in an undesirable effect on Germany’s balance sheet.
Furthermore, there are certain key demographics to bear in mind. Although Germany is among the most highly populated countries globally, its population is characterized by declining growth in many parts of the country. In common with other established economies in the West, medical advancements are causing German people to live longer, something that will lead to an ageing – and, therefore, less productive - population.
On the other hand, investing in Germany means investing in a country with one of the world’s highest levels of education, a place where economic productivity and technological advancements go hand-in-hand. Furthermore, the country’s solid infrastructure and national work ethic coupled with its continued work in the field of industrial innovation mean that investing in Germany is more attractive than in many other industrialized countries. After all, Germany is well-positioned to cope with adverse economic conditions. Indeed, Germany’s plans and preparations – both in industry and in government – mean that its economy should always withstand periods of economic volatility.