How well have we grown together?
28 years after reunification, living conditions in east and west Germany have converged considerably. But some differences remain.
The Wall divided Germany into East and West for 28 years – and that’s also exactly how long it is since it fell. Assessments of German unity since reunification on 3 October 1990 are largely positive. Here are the most important points in brief.
What has developed well since reunification?
The Federal Government’s annual report on the state of German unity 2018 confirms that the convergence of living conditions has made good progress. This is especially evident in the infrastructure, environmental quality, in city- and townscapes, residential living conditions and healthcare.
The labour market has developed positively in the east of Germany. Whereas the unemployment rate was still 18.7 percent in 2005, it had fallen to only 7.6 percent by 2017, compared to 5.3 percent in the western federal states.
In terms of economic strength, eastern Germany, with its large proportion of small and medium-sized enterprises, has almost reached the European Union average. Today, the proportion of gross value added generated by east German industry is above the European Union average.
In the competition between locations, the east often scores well with lower rents, attractive cities and landscapes, well-developed childcare facilities and good education opportunities.
What differences remain between east and west?
28 years after reunification, east Germany still lags behind the west in terms of wage levels, economic strength, research and innovation. One reason for this is the fragmentation of the economy in the east. Most major German companies have their headquarters in the west. Furthermore, many companies in the east belong to west German or foreign corporations.
What are the future prospects?
2019 will see the end of the Solidarity Pact for east Germany – under which the Federal Government and western Länder provide financial support for reconstruction in the east. It will be succeeded by a pan-German form of regional aid. However, the remaining differences mean that a large proportion of the development funding will still flow to east German regions.
The problem is that the per-capita gross domestic product in the EU will decline after Britain leaves the EU. As a result, purely statistically, the EU will be poorer and Germany wealthier. This could mean that the German regions might receive less money from the European Structural Funds in the future.
