Dieter Reiter: A leading European location – Munich shines far beyond Bavaria’s borders

“Munich shines.” This is how the city likes to quote a line by Thomas Mann, who included these words in his early 20th century short story “Gladius Dei”. However, still today, the state capitol shines as a cultural centre, a cosmopolitan metropolis with worthy living as well as an attractive business location. It is un­­deniable that Munich’s success radiates across large parts of Bavaria and provides important impetus for the development of the Bavarian economy. The inter­­­national perception and appreciation of Bavaria is closely tied to Munich’s image. At the same time, Munich would have never enjoyed its spectacular rise had Bavaria not devel­­oped into a modern home for industry, services and knowledge.

The symbiosis between city and state is, of course, most dis­­tinctive in the immediate vicinity of the metropolis. How­­ever, the Munich business region stretches far beyond the rural districts immediately surrounding the city. Thus the Munich Metropolitan Region was establi­shed in 2007 and it currently en­­com­passes 25 southern Bavar­­ian rural districts, almost 40 cities and communities affil­­iated with the rural districts and six independent cities: Augsburg, Ingolstadt, Kaufbeuren, Landshut, Mun­ich and Rosen­heim. 5.5 million people, or 45 per cent of the Bavarian population, live in this region. Munich’s strength, and the stren­gth of the entire metropolitan region, is the bal­­anced mix of global players, me­dium-sized business­­es and innovative company founders in well-net­worked sectors.

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Important sectors include information and communication technology, automotive, biotechnology and life sciences, banks and insurance companies as well as aerospace and satellite navigation. Hightech is of major importance: The business region is by far the leader when it comes to comparing technology locations. The large reservoir of qual­­ified service providers and suppliers is an important building block for the location quality of the Munich region.

Knowledge and innovation – the raw materials for the future. The outstanding education and research land­­scape provides innovation and ensures a steady stream of the next generation of highly qualified special­ists and man­­agers. The Ludwig-Maximilians-Universität München and Technische Universität München, both of which enjoy an excellent reputation, play an outstanding role in the scientific and academic sector. In total, about 106,000 stu­­dents are enrolled at 15 universities. Of the total student population, 15 per cent are foreign students. World re­­nowned research institutions include the Max Planck Soci­ety, Fraun­­­hofer-Gesellschaft, the German Aero­space Center DLR, German Research Center for Environmental Health (Helm­holtz Zentrum München) and the Ifo Institute. These institutions represent top-class research activities. In total, 24,000 em­­ployees work at publically financed re­­search institutions is the city of Munich and the number increases to 33,400 for the Munich Metropolitan Region.

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The public research and academic landscape is further supported by private investments in this sector. About 9,200 people work on new vehicles and technologies at the Research and Innovation Center of the BMW Group. Munich is not only home to the Siemens headquarters, but is also home to a major Siemens research facility in Munich-Perlach. Since 2004, Gen­eral Electric has been active at the GE Global Research Europe site in Garching. Research is conducted here by 250 scientists in the areas of energy and energy systems, composite material manufacturing, measuring and control technology, turboma­­chinery and medical technology.

The cultural and creative industries are vital economic factors for the metropolitan region. The Munich Metropolitan Region is among the leaders in the cultural and cre­­­­ative sectors. In the state capitol itself, 60,000 em­­ployees and 14,800 companies generate a turnover of 9.1 billion euros. A total of 117,000 employees, 29,000 companies and a turnover of 20 billion euros are generated in the Munich Metropolitan Region. This means that over 12 per cent of all companies and employees and over 14 per cent of the total turnover in the German culture and creative industry are generated in the Munich Metropolitan Region, whereby the share of turnover in the media sector (broad­­casting industry over 40 per cent, film industry almost 30 per cent) are particularly notable. Thereby, the European Metro­­­­politan Region of Munich is a leading site in Germany for cultural and creative business.

Munich’s infrastructure facilities – Ba­­varia’s hub and gate to the world. The well-net­worked transport infrastructure is a vital component for Munich’s location quality. The Munich Airport makes quick and worldwide connections for busi­­ness executives and private citizens pos­­sible. In 2013, al­­most 39 million passengers were trans­­­­­­por­ted. This means that Munich Airport has ad­­vanced to be­­come Europe’s sev­­­­enth-largest airport.

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Public transport in Munich is characterised by a close-­­­­knit route network, high service frequency and a modern vehicle fleet. The backbone of the regional connection is the urban rail­­way, and its 442-kilometre route network makes it the largest of all German urban railway systems. How­ever, constantly increasing pas­­senger figures, with over 800,000 users of the urban railway daily, make it inevitable to in­­crease the efficiency of the entire urban railway system and reduce the susceptibility to disruptions. This means that the urban railway’s main line must finally be relieved through­­ the construction of a second urban railway tunnel.

The Messe München fairground is one of the most impor­­t­ant windows for the German business sector. At­­trac­ting the greatest number of visitors are the Inter­natio­nale Hand­­­­werksmesse IHM craft trades exhibition, bauma­­ (trade fair for constru­ction machinery), and the BAU, the World’s Lea­ding Trade Fair for Archi­tecture, Mater­ials and Systems. Inter­­national trade fairs such as the Transport Logistic, Expo Real or Inter­solar attract ex­­perts and deci­­sion­ma­kers from around the world. Over two million visitors from around the world participate in events in Munich.

Prosperity and a high quality of life. The current ranking by the Initiative Neue Soziale Marktwirtschaft (INSM), a social market initiative and IW Consult, who evaluate the detailed indicators for prosperity, job market, structure and location, once again named Munich, as in previous years, as the best location among the 71 largest cities in Germany. The study also evaluates social aspects along with economic data. Thus, Munich is the safest metropolis in Germany.

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Munich looks optimistically to the future. Innovative business sectors, top-notch companies as well as excellent science and research make the state capital Munich and its surrounding area one of Europe’s most dynamic business regions. This analysis was confirmed by the Prognos Zukunftsatlas (Future Atlas), which rates the the district of Munich and also the state capital at the top of 402 German districts and greater cities in terms of economic dynamics, demography, labour market, com­­petitiveness and innovative capability.

Munich is therefore growing at a pace not seen for many decades. While the number of inhabitants remained relatively constant at 1.3 million from 1972, more than 1.47 million people live in the city today. In addition, it is expected that the number of inhabitants will pass the 1.5 million threshold in 2015. There is no end to this deve­­l­opment in sight. The planning department for the city of Munich is forecasting an increase in pop­ulation by almost 15 per cent by the year 2030, which means an increase to 1.65 million inhabitants.

This growth trend poses tremendous challenges to the city in the area of housing supply or the expansion of the transport infrastructure. As this development is not limited to the state capital – similar growth rates are expected for the region surrounding Munich – it means that the city and surrounding areas must meet these challenges together to allow a sustained and socially compatible development of the economic region.

However, thanks to the city’s and the entire region’s excellent economic situation, the city’s solid financial foo­­t­ing as well as a continued positive demographic devel­opment, the Munich region has outstanding prospects for the future.

 

portrait_ob-reiter_2014_neu_ohg_hf-kopierenThe author was born in Rain am Lech in 1958 and grew up in Munich. Since 1 May 2014 he has been Lord Mayor of the Bavarian Capital City of Munich. He was vice treasurer of Munich and from 2009 to 2014, head of economical section of the city.