Dialog International

Germany falls further behind in the digital economy

The accounting and consulting group EY has released its listing of the world's most valuable companies.  For the first time since 2006 - when EY first compiled the data - no German firm appears in the top 100 most valuable companies:

Deutschland ist erstmals seit Beginn der EY-Erhebungen im Jahr 2006 nicht mehr in den Top 100 vertreten. Der höchstbewertete deutsche Konzern ist der Software-Anbieter SAP mit einem Börsenwert von 106 Milliarden US-Dollar auf Rang 113. Die Deutsche Telekom schafft es mit einem Börsenwert von 98 Milliarden US-Dollar auf Rang 120.

SAP was always the one software company Germany could point to as a global high-tech competitor, but it now ranks at only 113.  Of course, 2022 has been tough on the tech sector, with valuations falling 25% across the board, but still Apple, Microsoft, Alphabet (Google) and Amazon are all in the top five of the most valuable companies.

And what about Germany's revered automobile industry?  Volkswagen comes in at 148 in the ranking, while Tesla is at place #6.  That's because Tesla is valued as a technology company. In fact, with a market value of $692 Billion Tesla is worth more than the combined values of Volkswagen, BMW,  and Mercedes.

Why is Europe - but especially Germany - lagging far behind the US and Asia in competing in the digital economy? Henrik Ahlers - EY's Country Manager for Germany - has the answer:

"Die schwache Aufstellung Europas und Deutschlands im Technologiesegment sollte uns zu denken geben", kommentiert Ahlers. Die USA profitierten im Vergleich zu Europa von einer höheren Risikobereitschaft amerikanischer Unternehmensgründer sowie deutlich besseren Finanzierungsbedingungen: "Vor allem in den USA ist es jungen Unternehmen in den vergangenen Jahrzehnten gelungen, völlig neue Geschäftsmodelle zu entwickeln und damit ganze Branchen zu revolutionieren. Europa hat in diesen Bereichen Nachholbedarf."

Germany will need to invest considerably more in the digitization of its industry in order to catch up with US firms.

 

Review: Harald Jähner's Aftermath:Life in the Fallout of the Third Reich

What happens to a people whose country has been destroyed by years of war - entire cities reduced to rubble by relentless firebombing, a nation reviled internationally as a pariah for its perpetration of the Holocaust?  They find a way to keeping living, and, eventually even thriving.  That is the gist of Harald Jähner's wildly entertaining book Aftermath ( Shaun Whiteside's translation of Wolfszeit).  Jähner's focus is on the lives of ordinary Germans, not the postwar geopolitical situation. And he covers the key stages of Germany's recovery: the almost giddy exhilaration in the immediate aftermath of having survived the war, the harsh conditions of hunger an lack of housing which led to Cardinal Frings' blessing of petty theft of coal and food (which coined a new verb: fringsen), the social upheaval caused by  millions of displaced persons and expellees from the former Sudetenland and East Prussian who transformed both cities and rural villages, the critical role of the Black Market which vanished virtually overnight with the 1948 Currency Reform.  All of this is covered by Jähner in the early chapters of Aftermath. 

The later chapters deal with the beginnings of the Wirtschaftswunder - Germany's "Economic Miracle" as it rose from the rubble to become Europe's economic powerhouse.  Jähner focuses here on key individuals who are representative for this astonishing transformation: there is Beate Uhse, a wartime pilot who became a household name as a sex entrepreneur and brought the sexual revolution to Germany a decade before the hippies and the "68ers"; there was Heinz Heinrich Nordhoff  who led Volkswagen from 1948, making the car manufacturer an icon of Germany's newfound economic power; there was Hans Habe, a writer and publisher who was initially installed by the American occupiers to create 18 regional newspapers but who later "went native" and was instrumental in building West Germany's vibrant independent free press; and there was Willi Baumeister, an abstract painter and designers, whose art was promoted by the American CIA to counter Soviet-style socialist realism.  If I have any criticism of Harald Jähner's book is that he barely mentions  the Gruppe 47 of writers and poets who reconnected Germany to modern world literature. 

The final chapter of Aftermath deals with how many German's "repressed" their involvement in the Third Reich as well as their horrific experiences during the war.  This was a 'willful amnesia' - perhaps necessary to some extent to move on and focusing on creating a new future. In this context, the attempt by the American Occupation Forces at "denazification" of the German population was an abject failure.  Still, the United States -through its culture - played the essential role in postwar Germany's embrace of democracy, as  Jähner points out in a recent interview in The Guardian: 

American entertainment culture had a very pacifying effect on Germany: its films taught us previously unknown, relaxed and laconic attitudes. It wasn’t just chocolate and cigarettes that made American GIs attractive to German women, but because they embodied a freer lifestyle. They were softer than their German counterparts: American soldiers were seen pushing prams through bombed-out cities, which was absolutely unheard of at the time. Germany learned less about liberalism through official denazification programmes than through pop culture. If there is a lesson for these modern times, it is how important it is to keep on caring for a nation even once it has been defeated.