With almost 200 countries recognized by the world today, there are countless contenders in the modern global market. Many strive to be world-revered trade capitals, while others prefer to keep to themselves. Today’s International Business Spotlight focuses on global trade with Germany, a major producer of machinery and technology and a major player in the global economy.
Global Trade Group Membership
In 2019, Germany ranked 22nd for the World Bank’s Ease of Doing Business index, just below Thailand and Finland. As World Business Culture writes, this ranking “is a testament to Germany’s forward-thinking approach to business,” as well as its “sound business regulatory environment.”
Part of this ease comes from Germany’s membership in the European Union (EU), which creates unique trade avenues with EU partners such as Sweden and Finland (ranked 20th and 10th by the World Bank, respectively). In fact, the EU regulates fair trade between these countries, both within the Union and with the larger world. The EU’s commitment to working alongside the World Trade Organization (WTO) is also a major factor in opening trade for these countries, especially for dual-members like Germany.
Industrial Prowess and Dedication to Quality
Germany’s major exports are industrial and manufactured goods. Automobiles, fuel, data processing equipment, and other machinery make up the bulk of Germany’s exports, with pharmaceuticals and agricultural products not far behind. While the EU’s regulations for trade with non-members (such as the United States) are strict, those sanctions don’t prevent Germany from achieving a high share of global merchandise exports—third, in fact, just behind China and the United States.
In part, this success is due to Germany’s role as a powerhouse for the tech industry. Demands for high quality and the serious, no-nonsense business culture of the country lend well to product management and huge, multi-faceted projects. The level of global merchandise exports that Germany has achieved speaks volumes of the country’s dedication to quality over quantity.
Challenges of Bureaucracy
The “bureaucratic approach” to starting a business in Germany, as described by Hong Kong and Shanghai Banking Corporation (HSBC), relies on several strict procedures and regulatory offices. These obstacles can be time-consuming and, at times, stressful to get through. Registering a property is a similar process, one that can take over a month due to the several bifurcated operations that must be followed. While Germany’s rich economy and fantastic business culture are not to be missed for international business aficionados, the strain of breaking out into Germany’s markets can be difficult to overcome.