NRW.INVEST: Revved Up and Ready – Petra Wassner
North Rhine-Westphalia has long been the engine behind Germany's economic growth. Petra Wassner, CEO of economic development agency NRW.INVEST, explains how the region's strong track record and capacity for innovation make it a good place to do business.
As Europe begins to emerge from economic recession, Germany is leading the way. Fuelled by a highly skilled workforce and the resurgence of export orders, the country's GDP is forecast to exceed 2.5% in 2011.
At the centre of this growth is North Rhine-Westphalia. The state has been at the heart of Germany's economic success since the 1950s, driven by its steel and coal industries. Although the importance of those industries has faded, a process of economic diversification has allowed the region to continue on an upward path.
Nineteen of the 50 best-performing companies in Germany are headquartered in North Rhine-Westphalia. These companies represent everything from pure manufacturing through to high-end mechanical engineering and service provision.
According to Petra Wassner, CEO of North Rhine-Westphalia economic development agency NRW.
INVEST, the state's rich economic history, innovative culture and convenient location make it the perfect place to invest in.
What makes North Rhine-Westphalia an ideal location to invest in, or establish a company or subsidiary?
North Rhine-Westphalia is Germany's number one investment location. More than 11,700 foreign companies from the most important investor countries operate their German or European operations from the state.
The most commonly cited reasons for setting up a business in the region are its central location, proximity to the main sales markets and the good transport infrastructure. The fact that North Rhine-Westphalia attracts so many companies from different sectors is also due to its wide-ranging industry structure.
Besides its economic diversity and relative proximity to Belgium and the Netherlands, North Rhine-Westphalia offers an interesting sales market for consumer products. Almost 150 million people live within 500km of the state capital, Düsseldorf. This represents a third of all consumers and 45% of the purchasing power in the European Union. The inhabitants of North Rhine-Westphalia alone spend €323.8bn on private consumption every year.
The state also scores points with its highly developed logistics services. North Rhine-Westphalia is one of Europe's central transportation hubs, and the city of Duisburg is home to the world's largest inland port, handling 100 million tons of goods a year.
Can you provide a brief overview of North Rhine-Westphalia's economy?
The region between the Rhine and Ruhr rivers is one of the most important economic centres in Europe; companies in North Rhine-Westphalia generate roughly a fifth of German GDP. If the state were considered as an economy in its own right, it would occupy 17th place on the international scale, just behind the Netherlands. It also boasts many big names, including Bayer, Bertelsmann, Deutsche Post DHL, Deutsche Telekom, E.ON, Metro, Rewe, RWE and ThyssenKrupp.
The region is the largest sales and procurement market in Europe; more than 17% of German exports are made in North Rhine-Westphalia and as an independent export nation it would rank 18th in the world. The economic structure of the area is characterised by a balance of traditional industries, innovative economic sectors and service providers. North Rhine-Westphalia is particularly strong in several areas, including the chemical industry, metal production and processing, the manufacture of metal products, the rubber and plastics industry, mechanical engineering, logistics, energy supply, e-mobility, the ICT industry and the healthcare segment.
What are the long-term benefits for a company coming to the state?
North Rhine-Westphalia is an industrial location with a long business tradition and a bright future. It has successfully handled difficult structural changes and possesses great potential for the future. The density and diversity of its R&D facilities is unique throughout Europe, leaving the state well equipped to meet fresh technological challenges. Its central position in Europe, outstanding infrastructure, highly qualified employee pool and situation in a market with great purchasing power guarantee the sustained success of investments.
What types of companies invest in the region?
The geographical origins of businesses in the region extend right around the globe. While it was once dominated by large international corporations, today it is mainly small and medium-sized enterprises that account for the majority of everyday business in economic development.
There have also been significant shifts with regard to the origin of the investors. The newly industrialised countries of Asia, with China at the head, are clearly on the advance. In recent years, North Rhine-Westphalia has also become a preferred location for European headquarters and distribution centres. One could say that the state has become the logistics hub of Europe. The most recent international investment projects are by companies such as Amazon, Esprit, Cook Medical, and TK Maxx, which are building job-intensive distribution centres, providing a large variety of value-added logistic services, and illustrating the attractiveness and importance of the state as a business location.
How is North Rhine-Westphalia different from other regions in Germany?
North Rhine-Westphalia is the beating industrial heart of Germany. The Rhine-Ruhr metropolitan region, with its approximately 11 million inhabitants, is one of the most important such areas in Europe alongside London and Paris. Its dense network of universities and cutting-edge research institutes, as well as its cultural diversity, cannot be found anywhere else in Germany. This is recognised by the foreign companies that have made North Rhine-Westphalia the preferred target of their investments in the company.
A Japanese community has formed in and around Düsseldorf, where it has created its own infrastructure of schools, businesses, banks and hotels, and the strong presence of Asian firms only helps to attract further investors. North Rhine-Westphalia is also developing into the most important investment location for Chinese companies in Europe; today, they account for the largest proportion of new business set-ups in the region.
What sort of value-added services do you offer to companies establishing operations in North Rhine-Westphalia?
Each investor is faced with numerous questions when venturing abroad, and a great many decisions have to be made. For this reason, the state of North Rhine-Westphalia provides a wide range of services for potential investors through NRW.INVEST, a one-stop agency that supports companies in their investment projects and settlement, throughout the entire process of establishing a business.
Services include offering advice on tax and legal matters, and information on the economic structure of the state. The experts at NRW.INVEST also offer assistance in finding a business location. They analyse investment projects, arrange appointments for negotiations with all those involved in the approval process and manage the process through to its successful conclusion.
NRW.INVEST operates subsidiaries in Japan and the US, and has representative offices in China, India, Korea and Turkey, which act as direct contact partners for potential investors.
For investors that are already located in North Rhine-Westphalia, NRW.INVEST supports expansions, start-ups and spin-offs. In doing so, the firm works closely with the local and regional economic development agencies in the state, North Rhine-Westphalia's Ministry for Economic Affairs, and various other federations, chambers of industry and commerce, and other business-related organisations.