PESTEL ANALYSIS OF

GERMANY
MEHAK AHUJA
DISHANT GOSAIN
ANKIT SAXENA
RIDHI SUNEJA
NIKHIL AGGARWAL
GERMANY
Capital - Berlin
Area - 357,021 km
2
(63rd)
Population(2013) - 80,781,000 (16th)
Density - 229/km
2
(57th)
GDP (PPP) - $3.194 trillion (5
th
)
GDP (Nominal) - $3.367 trillion (4th)
Per Capita - $39,059 (17th)
Currency - Euro ()
President - Joachim Gauck
Chancellor - Angela Merkel

Source: http://en.wikipedia.org/wiki/List_of_countries_by_population
http://data.worldbank.org/indicator/NY.GDP.MKTP.CD
http://en.wikipedia.org/wiki/Germany


GERMANY
Officially the Federal Republic of Germany , it is
a federal parliamentary republic in west-central
Europe.
Germany comprises sixteen states which are
collectively referred to as Lnder. Each state has
its own state constitution and is largely
autonomous in regard to its internal organisation.
Germany was a founding member of the European
Community in 1957, which became the EU in 1993.
It is part of the Schengen Area. It is a member of
United Nations, NATO, the G8, the G20,
the OECD and the Council of Europe, and took a
non-permanent seat on the UN Security Council for
the 20112012 term.
POLITICAL ANALYSIS
Germany is a federal parliamentary republic, and
federal legislative power is vested in the Bundestag (the
parliament of Germany) and the Bundesrat (the
representative body of the Lnder, Germany's regional
states).
The German federal state is a complex entity. It consists
of a central Federal Government and 16 federal states.
The German electoral system makes it very difficult for
any one party to form a government on its own.
This has only happened once in 56 years. An alliance of
parties is the general rule.
The Basic Law for the Federal Republic of Germany is
the constitution of Germany

Source: http://en.wikipedia.org/wiki/Germany

The Worldwide Governance Indicators (WGI)
project reports aggregate and individual
governance indicators for 215 economies over the
period 19962013, for six dimensions of
governance:

GDP $ 3.63 trillion
GDP growth rate 0.4 % (0.7,3.3,4.0,-5.1)
BoP $ 240 billion
Inflation 2.2 %
Unemployment 6.7 %
Exports and Imports $1.49 & $1.27 trillion
dollars
Export countries France,UK,Netherlands,USA
,Austria,Italy
Export Items Motor
vehicles,machinery,chemicals,
electronics,pharma
Import countries Netherlands,France,China,Bel
gium,UK,Italy
Import Items Oil and gas,metals,agriculture
Ukraine crisis
Low inflation
Eurozone crisis
Economy
SOCIAL
ANALYSIS
Population: 82,282,988
Population growth rate: -0.061 %
Birth rate: 8.21 births/1000 population
Life Expectancy: 79 years
2
nd
most populous European country
Population density: 230 per sq km
Median age (male): 42.6
Median age (female): 45.2
Age Structure:
0-14 years: 13.7%
15-64 years: 66.1%
65 years and over: 20.3%
Urban Population: 74% of population

Source:https://www.princeton.edu/~achaney/tmve/wiki10
0k/docs/Demographics_of_Germany.html


Labour Force
Average work week: 37.5 hours
Normal business hours: 9 am 5pm
Retail hours vary, limited hours on Sunday
Average wage: 27.9 EUR (Western Germany) and 17.4 EUR
(Eastern Germany)
Typical Annual Leave: 20-30 working days

German Consumer
The typical German consumer rejects the idea discounts shops
and places value on quality.
Emphasis on safety , quality , comfort and reliability
Household consumption (2013): 1,143,489 USD
Household consumption per capita (2013): 13,926

Religion
Religious freedom
Protestant (33%), Roman Catholic (33%), Muslim (4%), 108,000
members of Jewish communities, and others


Germans have a strong sense of regional pride.
Reputation for being industrious ,thrifty , and orderly.
Germans usually express their thoughts and opinions in
a direct way.
Separation between private and public relations.
Interest in academic credentials but not personal life.
Formal communication and greetings.
Business deal is usually mutually beneficial and the
central focus is just the task.
Attention to be paid to targets and time schedules.
Appointments are to be taken before meeting someone.
Decision making is a slow detailed process.
Correspondence should be in German.

Culture

Innovation and new technologies
Germany ranks eighth out of 139 countries for innovation in
the World Economic Forums (WEF) Global Competitiveness
Report 2010-2011.
According to the WEF, Germany is the international leader in
terms of capacity for innovation, occupies fourth place for
company spending on R&D, and secures sixth spot for quality
of scientific research institutions.
Germany ranks third, after Japan and Sweden, for patents
filed simultaneously with the U.S., Japanese and European
Union trade offices.
Germany is among the top five of 17 analyzed countries
including the U.S. and U.K. for the development and
marketing of high technology.
Collaborations between the Federal Government, federal
state and the economy to invest three percent of GDP in R&D
until 2015.

Source : http://online.wsj.com/ad/article/germany-
innovation.html


Technological Analysis
Germany R&D
In 2009, research and development accounted for a 2.8% share of
German GDP. This is one of the highest R&D rates in the world,
surpassing the United States for the first time since 1989.

German companies work in close partnership with universities and
research institutions. They cooperate in a number of areas including
mechatronics, microelectronics, power electronics, telematics,
environmental and process engineering, and materials research.

Over 31,000 companies in Germany engage in ongoing R&D
activities, and this provides a strong basis for a positive climate of
innovation.

The main funding for R&D comes from the private sector.
Businesses financed 68% of R&D expenditure in 2007, according to
Eurostat, the EUs statistical body.

Source:
http://unctad.org/en/PublicationsLibrary/wir2012overview_en.pdf
Environmental Analysis
2011- Germany is worlds 6
th
largest and Europes largest
carbon emitter
After signing Kyoto Protocol:
23% reduction in carbon emissions
39% of wind energy of worlds requirement
Committed to use renewable energy sources
2013 Initiative for SMEs, Energiewende to boost
transformation of German
energy system

Source:
http://en.wikipedia.org/wiki/German_response_to_Kyoto_Prot
ocol

Legal
Law enforcing system is divided at 3 levels
Federal, State & Local
More powers at state level whereas federal police
intervene only at National & international level
The German Supreme Court namely the Federal
Constitutional Court monitors maintenance of rights
and preservation of justice.
Historically speaking German law in part goes back
to Roman law
The administration of Justice is divided into 5
branches:
Ordinary, Labor, Administrative, Social & Financial
Courts
In surveys on political and legal stability foreign
investors put Germany second only to Britain
This legal stability attracts foreign companies and
benefits entrepreneurial activities in Germany

BUSINESS TO INVEST IN:
Environmental Technology
Germany's environmental technologies industry is
expected to reach a higher sales volume than
automotive or mechanical engineering by 2020.
The German environmental technology industry has an
internationally leading position, particularly in the fields
of air pollution control, noise mitigation and recycling.
In addition to traditional services in the areas of waste
management and water resources management, the
field of environmental technologies includes all
technological products and processes that promote a
sustainable and forward-looking economic orientation.
The relevant fields of technology in this context are
environmental protection,
air pollution control,
water conservation and water resources management,
waste management,
soil conservation and the
protection of limited resources.

IMF upgrades its growth forecast in
2014(1.7 1.9)
Consumer confidence dips

News
References
http://www.tatsachen-ueber-
deutschland.de/en/head-
navi/home.html
http://performance.ey.com/2012/08/16/
germany-business-environment-at-a-
glance/
http://www.bundesregierung.de/Webs/
Breg/EN/Homepage/_node.html
http://en.wikipedia.org/wiki/Economy_
of_Germany