I visited Germany recently on a short holiday. I had flown to the Niederrhein Airport in Weeze on a Ryan Air (the low cost carrier) plane. The Weeze Airport which is only 2 years old and still heavily under utilised still looked a lot better than most national airports in the developing countries. The Airport looked spick and span, and glistened as if it was just a day old.
However, any such good impression on a visitor is lost immediately as the visitor comes into contact with Germans and engages them in a conversation. My first stop was in one of the car rental offices, as I made enquiries at the counter, the duty officer Karl (not his real name) tried to be nice to me in his heavily accented English, I saved him any further attempt at swallowing his tongue, and spoke German to him. Karl seemed quite perplexed that a black man flying in from London is able to speak his language; I explained to him that I had lived in Germany for a few years before relocating to the UK, on hearing this, he let his guard down although I wished it was the car rental rates that he had lowered instead.
Karl engaged me in some light hearted conversation, he could afford to, there was no queue behind me and I wasn’t in any kind of hurry either. Our banter eventually moved on to the state of the German economy, and this appeared to have touched his soul, he spoke with such conviction that I wondered what he was doing behind the desk of a car rental company, rather than working in some government economic office. I did ask him that, and he replied that he had been downsized; an evidence of what he had earlier told me was the problem with the German economy. He blamed Gerhard Schroeder and his Euro/Europe loving Social Democratic Party for his and his country’s woes, according to him ‘The politicians have ruined Germany, people are just managing to keep a smiling face but deep inside them, they are all burning, it’s like nobody knows what’s going to happen next, there is so much fear in the land now’. Finally I decided that Karl’s tales of doom wasn’t my ideal way of starting a holiday and I bid him goodbye, promising to continue our conversation on another occasion. I did look for him on my way back but he was off-duty on the day.
As I sped to Dusseldorf on the A57 autobahn, I found it difficult to confirm all of Karl’s fears, although I wasn’t expecting to see the type of rickety and beat-down cars that litter the pot-holed roads all over Africa but the several new cars which sped past me on the way did not really indicate an economy that is about to crash. German motorways which in most cases do not have any speed limits are arguably among the best in the world, and from my experience Germans love taking out their anger and frustration out on their motorways, hence their fascination with strong and fast cars.
German motorways are well sign-posted
The motorways are also well sign posted, I began to wonder why Julius Berger Nigeria Plc is not taking a cue from Bilfinger & Berger (their German parent company) in providing quality road signs in all the roads they build in Nigeria, most especially in Abuja. Their road signs in Nigeria can at best be described as a beginning artist’s practice work sheets.
I also took advantage of my visit to shop for bargain items; the Euro/Pound dichotomy has considerably made products and services cheaper in mainland Europe than in the UK, take for instance a Fuji digital camera I bought at Promarkt in Dusseldorf for 199 euros, the same camera retails for around £349 in London. Another clear example of capitalist exploitation then, you may say.
I tried to engage Germans in conversations at every opportunity; the general feeling was still that of nostalgia, fear and disappointment. This is quite understandable especially with the unemployment figures in Germany now estimated at over 5 million. Looking back, it is not so difficult to see what went wrong with the German economy, once one of the strongest in the world. Several factors have combined to push the German economy down to the level it currently is at the moment.
The first is the German unification, after the Berlin wall came crashing in 1989, The government of Helmut Kohl embarked on a massive programme of re-building infrastructures in the former East Germany, conservative estimates of the amount spent so far by the German government vary but according to the website - factbites, Since reunification in 1991, the German government has spent over $1 trillion on rebuilding the infrastructure of the former communist East Germany. The economy wasn’t growing as fast as was predicted to fund the escalating expenditure, at some point it appeared as if the German economy was shrinking and market expansion into Europe became an attractive option, the Germans bought the Euro/Europe package hook, line and sinker and went in head on, but this has also back fired. The much expected benefits of one Europe failed to materialise because, the government did not reckon with globalisation, which has made it possible for cheaper and still well made products from Asia and America to compete against the much touted ‘Made in Germany’ products. Germans appeared to have arrived late to the party, and have suddenly woken up to reality. History also shows that Germans have always been an inward looking and self-dependent people, and so they were not well prepared for a new and sudden psyche of sharing a common faith and destiny with other people in the now united Europe.
The once cherished Made in Germany mark
Germans who are normally very stolz (proud) people believing so much in their technik and engineering as well as in the efficacy of their products and services now surprisingly are buying cheaper imports ranging from cars to electronics etc. In today’s world economy, consumers care less about a product that will last several years, such as Grundig and other such German made products. Consumers now prefer well designed, fashionable and trendy products, and this is where German firms lost the plot, German firms believe so much in technik and are also known to make boring products, but we live in a different age now, and consumers now have different lifestyles and expectations.
A CIA fact book entry described Germany in the following unsavoury terms ‘Germany's affluent and technologically powerful economy- the fifth largest national economy in the world - has become one of the slowest growing economies in the entire euro zone, and a quick turnaround is not in the offing in the foreseeable future’.
Germany may still be a primary destination for political and economic refugees from many developing countries, but the number of asylum seekers has been dropping in recent years, reaching about 50,000 in 2003. Could this then mean that even immigrants are getting the message, and are staying away?
Germany's ageing population, combined with high unemployment, has pushed social security outlays to a level exceeding contributions from workers. While there is no immediate forecast of change and upswing in the German economy, it is indeed a sign of worry and concern and the rest of the world should ponder what happens next to this once envied world economic power. There is a danger for some overzealous patriots to easily swing Germans over with sweet rhetoric, false promises and hope, Germans themselves may not have any problem in following any such ‘messiahs’, who normally will be extreme left wing separatists, a situation like this will take the world back to the Nazi days all over.
I am sure Gerhard Schroeder won’t be sleeping well, not with the recent results of the referendums on the EU constitution in neighbouring France and Holland, his once hoped for saviour (a united Europe) to restore the German economy to its pristine glory is fading away fast, and he doesn’t seem to have many answers.
Germany will host the world cup in 2006, but that doesn’t seem to be enough good news for Germans, their passion for football is currently at odds with their anger and frustration as a result of the state of their economy, they may therefore have shown the world a taster of what to expect next year, judging from the crowd disturbances that greeted their recent 2-0 win over Tunisia in the 2005 Confederation Cup being hosted by Germany.
Frau Heike, a jewel retailer in Düsseldorf, however thinks that things are not as bad, according to her ‘Germans are always complaining, maybe it is the frustration of the cuts on state benefits which they have come to depend so much on that is making them to shout’. People like Heike, a new breed entrepreneur may not yet be feeling the pressure, but there is in fact trouble in the land. Almost on a daily basis, there are news of German firms closing down, most worryingly are the news of the current predicaments of two corporate giants BASF and SIEMENS, would their demise be the last sure sign that the Germany we know today is no longer the Germany we used to know?
Even Mercedes Benz, the symbol of Germany’s industrial prowess has been experiencing hard times; Mercedes Benz may soon stop being the shinning star of the German economy, because consumers are no longer snapping the brand up, like they have done in the past. Recent reports claim that the Mercedes car division of the Daimler Chrysler group may soon sink into the red, with loss estimates at over $500 million. The Smart brand (a collaboration with watchmaker Swatch) hasn’t started off well, the brand loses about $600 million a year, total loses since the launching of the brand in 1998 is now estimated at over $3 billion. Analysts say that the brand does not generate enough revenues to cover costs.
The Mercedes Maybach
Another problem child is the Mercedes Maybach, the high-end luxury car priced at over $300,000. Total world wide sales till date are just a little over 500 units, this is despite the trappings and luxury that the Maybach offers, including a personal liason manager. What German firms need to learn from all these are that consumers may no longer be prepared to pay over the top for quality, especially when there are other competing and cheaper brands, from the new emerging markets of Asia and Europe.
Whatever has gone wrong with the German economy should also be a lesson for the other strong economies of the world, national fortune may now be likened to a wind, it can blow towards any direction at any time. For the developing countries, most especially Nigeria, they shouldn’t depend heavily on the proceeds of crude oil sales as the only source of revenues, we don’t want to wake up one day to discover that our cherished crude oil customers have now discovered cheaper and alternative energy sources, the human tragedy that will follow such a situation will be enormous. For Nigeria and the rest of the developing world, strategic planning is the way forward.
Re:  Germany But Not As We Know It
Unregistered posted on 12-08-2005, 09:26:41 AM
It is really a pity to see the German economy go down but as a naturilized citizen of that said country not all what the writer wrote is the truth but as we all know Germany still has the best economy in europe.
Compared to other European countries Germany can still hold is own although as the writer rightfully found things are not what they seem to be..with an Ageing population and an economy that is just refusing to get back on his feet..