The East Catches Up | Business| Economy and finance news from a German perspective | DW | 04.01.2005
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The East Catches Up

A recent study of German cities confirms that the country’s economic powerhouses are concentrated in the West. But among the up and coming locations are several cities in the former East.


Dresden is top among eastern cities

Of all German cities, Munich has the best economic perspectives, with Stuttgart, Düsseldorf, Hamburg and Heidelberg following behind closely, according to a recent ranking published in Capital magazine.

München Rathaus und Liebfrauenkirche

View of Munich's townhall and Church of Our Lady

Analysts at the Bad Homburg Institute of Economics evaluated 60 of Germany’s biggest cities in terms of growth, employment figures, population and purchasing power and predicted how they would develop between 2002 and 2011.

The top 10 cities are all located in the western part of the country, and include cultural and financial centers such as Cologne, Frankfurt, Wiesbaden and the former capital Bonn. Berlin, which is struggling with high unemployment and declining investment, ranked only 32nd on the list.

Essen: Zeche Zollverein

The industrial Ruhr region in Germany's northwest is declining in economic potential as heavy industry and mining shut down

The industrial Rhine-Ruhr region, comprising cities such as Dortmund, Bochum and Duisburg, showed the biggest decline in economic indicators compared to a 2002 ranking. Bochum fell nine places down to position 38; Krefeld dropped down to 48 and Essen – the biggest loser in the West – tumbled from 21 to 34. Population decline and unemployment contributed significantly to the lower ranking.

Improvements in the East

Surprising was the number of eastern cities which made it into the top 60. Compared to a similar ranking two years ago, four more cities made it onto the list. The top among the eastern metropolises was Dresden, which moved up from spot 34 to 14. Leipzig improved the most, jumping from 43 to 19. Jena climbed up 20 points to position 21 and Potsdam surpassed neighboring Berlin to end up in position 30.

Galerie Bundesländer Meckenburg-Vorpommern Schloss Schwerin

Schwerin on the Baltic Sea might be a nice tourist destination, but it's not attracting a lot of investment

While the former East has its bright spots, particularly in the cities such as Leipzig and Dresden where high tech companies are beginning to invest, the region still has its downside. The last five positions in the city ranking were all taken up by eastern cities: Magdeburg, Rostock, Chemnitz, Halle/Saale and Schwerin.

The difference between the top and bottom of the list is particularly dramatic in terms of forecast for the next several years. While the economic potential of Munich increases by 25 percent, Schwerin is only expected to grow by about 7 percent.

Cities beat out countryside Overall, German cities proved to be the most dynamic in terms of boosting Germany’s economy. Whereas urban areas are expected to produce an average growth rate of 18.9 percent, the rest of the country is only likely to turn out figures around 14 percent.

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