THÜRINGEN - Economy
Thüringen's central location can be visualised by realising that the routes from Paris to Warsaw and from Rome to Riga both pass through it. Its position at the centre of Europe is a very decisive factor in its economic development. Top priority has always been given, therefore, to extensive development of the supraregional transport routes.
So far more than 100 km of new motorway have been built and the existing stretches have been improved in order to cope with the ever-increasing volumes of traffic. The efficiency of the network of main and secondary roads is constantly being enhanced by the construction of bypasses.
The rail network has been thoroughly rationalised, even though the high-speed Nürnberg-Erfurt-Halle/Leipzig stretch forming part of the trans-European Verona-Munich-Berlin-Malmö rail link is yet to be built or developed.
The Erfurt international airport and the Altenburg (east Thüringen), Schlotheim (north Thüringen) and Eisenach (south-west Thüringen) regional airports provide links with the national and international air-transport networks.
Industry is the driving force
Economic development in Thüringen since the leap from a planned economy to a social market economy has been extraordinarily dynamic. Thüringen started out in 1991 with a GDP of €9 013 per head of population and achieved a 77% increase by 2002 - the highest in any of the Länder. It is still lagging a little behind the western Länder, however, with its GDP of €15 945 per head of population in 2002 corresponding to only 61% of the level in the old Länder.
Services are the dominant sector, accounting for 69% of value added. Manufacturing and construction account for 29% and agriculture for a mere 2%.
Developments in industry) have been particularly vigorous even though the starting level was relatively low. Turnover has more than tripled since 1991 with non-domestic turnover increasing fivefold. More than half of the total turnover in industry is in six branches, the strongest being the food industry with 13% of the total. The manufacture of motor vehicles and motor-vehicle components accounts for 10% of turnover, followed by the manufacture of metal products with 8.6%, the manufacture of equipment for the generation and distribution etc. of electricity with 8.2%, the manufacture of office and data-processing equipment with 7.6%, and mechanical engineering with 7.2%.
Export of goods has become an important element in Thüringen's industry following the decline of the traditional markets to the east at the beginning of the 1990s. At first the export ratio fell sharply, reaching its nadir in 1993 with barely 12%. Since then, non-domestic turnover has steadily increased in importance, with the export ratio reaching around 26% in 2003.
Items that are particularly in demand abroad are motor vehicles, which account for 13% of exports in terms of value, and measurement and control equipment, which account for around 8%. Around 80% of exports go to other European countries, France being the main trade partner with more than 10% of the total. The second most important customer for Thüringen's products is the USA with more than 8%. This is particularly remarkable as in 1991 exports to the United States accounted for less than 1% of total exports.
Around 70% of imports to Thüringen come from other European countries and 26% come from Asia. China accounts for 9.3% of imports, coming second to the Netherlands as a source of imports to Thüringen. In 1991, imports from China accounted for less than 0.5%.
The more than sevenfold increase in productivity (turnover per employee) in industry since 1991 was initially at the expense of employment. Since 1997, however, there has been a clear upward trend which resulted in 58 people in 1 000 being employed in industry by 2002. In a comparison with all the Länder, Thüringen came ninth - ahead of all the other new Länder and Hamburg and Schleswig-Holstein.
Overall, the comparatively low wage costs (remuneration per employee) have not yet made Thüringen a favoured site as expected. In 2003, wage costs over all sectors were €26 395 - i.e. considerably lower than the average for Germany as a whole (€33 229). Wage costs were €27 331 in manufacturing industry, €26 301 in services, and €18 903 in agriculture.
Agriculture sets the scene
In large areas of Thüringen the landscape is agricultural, since agriculture accounts for more than half of total land-use. Around 80% of the agricultural area is arable land, mainly used for growing cereals - particularly wheat and barley. There has been a reduction in cattle- and pig-farming over the last ten years, while sheep- and poultry-farming has increased. Agriculture in Thüringen differs substantially from agriculture in the western Länder in the size-structure of holdings: far more than half the total agricultural land is operated by a mere 5% of the total holdings.
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