Investments in plant and equipment: eastern German share stagnates

In its Investment Calculation the Ifo Institute regularly calculates the sectoral investment expenses in western and eastern Germany. These results supplement the survey of the Ifo Institute on investment activity in western and eastern German manufacturing and provide a regionally and sectorally differentiated overview of investment activities in Germany. According to these calculations the gross plant and equipment investments in Germany in 2003 once again were lower than in the previous year. This decline amounted to €13.6 billion, which corresponds to 3.3%. In the service sector investments shrank by €10.8 billion or 3.3%, in the producing sector they shrank by €2.2 billion or 2.9%. Within the service sector the area of financing, renting and corporate services, within which the property and housing play a prominent role, showed the greatest decline in absolute terms with €7.2 billion. With 4.0% in 2003 the decline of investments in plant and equipment in the new federal states was only slightly stronger than the German average. In absolute numbers the eastern German investments in plant and equipment shrank by €2.8 billion in 2003, which was a fifth of the reduction in all of Germany.