The Railways in 2020. The Berlin Experience.

On Tuesday morning we had a couple of meetings in Utrecht and headed by on a 6 hour train journey, via Duisberg, to Berlin. Which gave me time to write the last blog!

With a gross domestic product of more than 2.6 trillion Euros, Germany is the largest economy in Europe and the fifth strongest economy in the world. The country has a strong industrial base and is heavily export orientated. They are the second largest exporter, after China.

Germany was one of the first European countries to emerge from the recession in 2009 with GDP growth of 3.7% in 2010 and about 3% in 2011. The outlook for 2012 is less positive with growth expectations between 0% and 1%.

The German economy is characterised by its small and medium-sized companies. Whilst the big players such as BMW, Daimler, Siemens, Adidas are well-known, approximately 99 % of all companies are SMEs (German SMEs are defined as having up to 500 staff), many of which are hidden global champions in their sub-sector. Most SMEs are family owned and have been passed from one generation to the next.

The overall unemployment rate has consistently fallen since 2005 and reached a 20 year low in December 2011 at 5.5% (ILO rate).

The most recent Federal Election was held in September 2009. Following the success of the CDU/CSU (33%) and the FDP (14.6%), Chancellor Merkel separated from the previous coalition partner (the SPD, which polled 23%), and formed a government with the FDP. The Coalition has 330 of 620 seats in the Bundestag.

All three of the smaller parties in German Parliament achieved their best ever result in a Federal Election: the FDP 14.6%, the Greens 10.7%, the Left Party 11.9%.

In Berlin, we met with members of the German Transport Select Committee and discussed the differences between big Transport schemes in the UK and Germany.

In Germany, there is a very strong citizen’s lobby, which means that governments cannot force through unpopular schemes. All major infrastructure proposals require a local referendum before they are approved.

Recently, 54% of Munich’s voters rejected a third runway at their city’s airport. The city’s mayor Christian Ude (SPD), who had supported the building of a third runway, said that although the referendum is legally binding for a year only, he regarded the decision of the city’s voters as final.

Perhaps all this talk of a Macho government forcing through a third runway at Heathrow would be tempered with a binding local referendum!

On Wednesday morning, we met with two German Transport companies, Veolia Verkehr and the biggest Deutsche Bahn (Germany’s state run railway company, and Arriva’s parent company). We discussed how Germany’s Inter City routes (which are open to competition) are too risky for competitors to enter the market. We also discussed the level of integration of their transport network, and the German government’s long term aspiration to tender all routes and privatise DB.

Then we met the staff of Berlin Transport State Secretary (a bit like our Chair of Transport For Greater Manchester), and his Federal equivalent. Like Holland, Germany has a more devolved decision-making process than the UK, which means a more integrated service than the UK.

Following these meetings, we headed to Munich for the second day of our trip to Germany.

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