In the coming weeks, Projekt Hansa will be publishing a more thorough business profile on Schleswig-Holstein. Here is a brief overview on the region.
Schleswig-Holstein is the birthplace of the medieval Hanseatic League, its origins often traced to the city of Lübeck in Holstein. The region’s prime location between the North Sea and the Baltic Sea made it prosperous and the central nerve of the commercial confederation. Today, the northernmost federal state in Germany has not moved an inch and is still a significant Northern European commercial crossroad.
Schleswig-Holstein is an ideal location for European business, providing notable advantages and acting as a gateway to markets in Scandinavia, the Baltic States and Eastern Europe. Infrastructure design has been forward thinking, striving to meet the needs of the future, but also optimising efficient transport connections in Germany and with Scandinavia.
Here is an overview of leading industries in the region:
- The sector has significant growth potential and covers transport, trans-shipment, and warehousing. In 2016, it employed over 54,000 people in almost 3,200 companies.
- Maritime Economy
- The 2016 annual turnover of the 1,800 active companies totalled €9.2 billion, with the core of the industry made up of shipbuilding and its suppliers. Important developments in oceanography, deep-sea technology, and marine biotechnology are also central to this industry.
- Renewable Energie
- Large-scale policy projects have made Schleswig-Holstein a pioneer in this sector, employing about 18,400 people and benefitting from serious investments. Just in the wind energy sector, more than 1,400 authorisations were issued in the last 5 years for the construction of wind power plants, amounting to a total investment of more €4 billion.
- Healthcare Industry
- Medical technology together with pharmaceutical companies are driving innovation and growth in the region. By itself, the medical technology industry employs over 9,200 people and had a turnover of €1.6 billion in sales for 2015.
- Food Industry
- The food sector employs over 21,000 people in hundreds of SMEs specialised in meat and milk processing, baking, and confectionery. In 2015, €7 billion were generated by this industry.
- Mechanical Engineering
- Mechanical engineering is one of the main pillars of the Schleswig-Holstein economy highlighted by its 21,000 employees, turnover of €6.9 billion in 2014, and export share of about 65 percent.
Economic clusters, a regional concentration of interconnected businesses, suppliers, and associated institutions in a particular field, in Schleswig-Holstein benefit from favourable location factors and spatial proximity. Here are some of the most important one:
Last but not least, income taxation of corporations in Schleswig-Holstein is subject national and local laws. The corporate tax rate in Germany is 15%, and local business tax rates in Schleswig-Holstein varies between 8.75% - 15.75%.
General VAT in Germany is at 19% (below European average) and for basic everyday items, it is reduced to 7% - sales tax exemption also exists for certain services.
Deloitte’s International Tax Germany Highlights 2018 is a comprehensive document that is handy for more information on taxation in Germany.
[Image from WT.SH Business Develpment and Technology Transfer Corporation of Schleswig-Holstein]