Germany is the third-highest exporter in the world according to recent World Bank data, with goods and services shipped out of the country making up close to 43% of GDP. The country is comfortably Europe’s largest economy, and such is the wider reliance on its success that the appointment of a new Finance Minister during the recent elections was the key issue for not just those inside the country but many outside too.
With such emphasis placed on what Germany does economically, how is the country mapping out its future in the financial markets, and what moves are being made in 2022?
Foreign Focus Brings New Investment
Brexit has brought a boost that may kick-start the whole of Europe’s economic mission from south-western Germany. As home to the European Central Bank (ECB) and Deutsche Bundesbank, Frankfurt is already known on the financial scene, but that is about to be amplified. US giant Morgan Stanley’s movement of $120bn in assets as a result of Brexit is expected to be fully completed in the first quarter of this year and is just a scene-setter with Goldman Sachs, Standard Chartered, Citigroup, and UBS also moving operations. Just how the European giant handles such investment will mean change, however.
Education Set To Trigger Generational Advancement
The desire of venture capitalists to now invest further in the country means more opportunity for growth, and as Germany remains a leader in innovation, with over 25,000 patents granted during 2020, stats from the CPO confirm there is no shortage of takers. The challenge is for the country to now take a much more concerted approach to financial education. Centers of study and research around the nation are now wanting strong emphasis on banking, the financial sector, monetary and currency policy, international economic policy, and insurance systems as strongly inter-linked subjects. Traditionally weak on financial education among the population, there is a need for international input, and so the investment is being made to encourage expertise from across the globe with initiatives like the international full-time MBA program offered by WHU – #1 in Financial Times’ global MBA ranking. Around 87% of their cohort is international, and this influence will, hopefully, develop a new path for citizens as a whole.
Start-up Successes Signal Future In FinTech
Real-time moves are being made domestically to develop new thinking, with Germany long being a traditional industry when it comes to banking. The shift we’re seeing is that FinTech is taking hold within the wealth and insurance sector to the extent where it is now a top-five investment category among German venture capitalists, data from a leading investment study has suggested. Berlin has become the base for native companies, such as Solarisbank, who are looking to re-invent the way finance is conducted, both domestically and internationally. Investment in FinTech boomed during Q3 of last year across Europe, and now even local financial authorities within the nation are exploring avenues to get on board.