Economy of Berlin - Current Situation and Outlook

Current Situation and Outlook

Berlin has been called the "Capital of poverty", because in no other State of Germany so many people are living on welfare benefits (in percentage, not in absolute numbers). In 2005 an estimated 15,2% of the population received welfare (ALGII or Sozialgeld). In 2006 36,1% percent of all Berlin children aged 15 and younger received Sozialgeld, which is given to children, who live with an able bodied person, who qualifies for welfare. According to the Bertelsmann Stiftung this is due to the number of minors having to look after the family because of absent parent(s).

Fast-growing sectors are communications, life sciences, mobility and services with information and communication technologies, media and music, advertising and design, biotechnology and environmental services, transportation and medical engineering. Berlin is among the top five congress cities in the world and is home to Europe's biggest convention center in the form of the Internationales Congress Centrum (ICC). It contributes to the rapidly increasing tourism sector encompassing 592 hotels with 90,700 beds (2007 figures) and numbered over 22 million overnight stays by 9.8 million tourists in 2011. Berlin has established itself as the third most visited city destination in the European Union. Due to increasing growth rates and tax revenues, the Senate of Berlin forecasted budget surpluses in 2008 and 2009.

Berlin's economy has grown continuously above the German average in the period from 2005 to 2011. This trend is set to continue, with important improvements to infrastructure, such as the biggest European crossing station, Berlin Hauptbahnhof (inaugurated 2006), the opening of the 3rd biggest German airport, Berlin Brandenburg Airport, scheduled for 3 June 2012 and intended as the major eastern European hub, reflecting the expansion of the EU towards the east. Also, the revered Berlin music scene, attracting tens of thousands of young tourists flying in for the city's famed clubs has become an increasingly important part of the economy, attracting artists and tourists alike, and is set to gain the support of the new 2011 government in order to protect the free spaces required by the scene through the creation of a city music board modeled after the German film promotion.

Some notable companies with their headquarters in Berlin are Air Berlin, Axel Springer AG, Deutsche Bahn, Bombardier Transportation, Universal Music Germany, and Vattenfall Europe.