Structure Analysis of the Eastern German Chemical Industry

Tasks

This project includes a comprehensive review of the chemical and pharmaceutical industry in eastern Germany. Furthermore, it compares these two economic sectors with its western German counterparts. Both chemical and pharmaceutical industries are essential for the German economy.  Measured by their domestic and international sales, the two industry sectors rank among the largest in Germany. In addition, the chemical industry is a very important player for the whole economy due to its upstream position for other industries.

Results

For eastern Germany, the highest density of the chemical industry in terms of establishments and employment is located in the South-East of Saxony-Anhalt (Central German Chemical Triangle). Further important locations are Saxony, Thuringia and the greater Berlin area. The pharmaceutical industry is mainly clustered around Berlin.

A comparison of the chemical and pharmaceutical industry in eastern Germany with its’s western German counterparts shows no substantial differences for most economic and business indicators: in terms of sales, revenues or employment both German regions have shown the same development in recent years. However, substantial differences emerge in research and development (R&D) intensity. Especially the chemical industry in eastern Germany lacks substantial R&D investments. Increasing R&D expenditures are highly recommended to defend the industry´s strong international market position. The pharmaceutical industry in eastern Germany shows relatively high investments in R&D, even though it is still lagging behind the West.