Panel discussion "Economic Growth - Vital Necessity for Germany and Russia: Old Recipes and New Concepts" was held yesterday in the Russian-German house in Moscow. One of the panelists, professor of the University of Würzburg, member of the advisory council of the German government on macroeconomic development, Peter Bofinger, discussed Germany's experience that can be applied to Russian economy in an interview with Vestnik Kavkaza.
- Given Germany's experience, what do you think about key points of growth that can be used in Russian economy?
- The German experience shows that it's very important to have good relationships between the employers and the employees. I think that's a big part of Germany's success story. We have very good relations between the workers and the management. We have a system of codetermination. There are representatives of the trade union that are in boards of big companies. And I think that's really helpful and really unique, because the strength of economy is what people do, how effective they are, how their engagement is. I think that's very important that we have very good relationships between management and labor.
Another imporant recipe in Germany is that we have combination of very big players, companies, but also of a lot of small and medium sized companies, so called champions, that are spread all over the country. They are specialized on very small things, but have very high expertise. I think these small and medium sized enterprises have realized at a very early stage how important it is to become global. Many of them have become very active in China 25 years ago, and they are very successful in that. So I think this combination of big players like Siemens, Volkswagen and Mercedes, but also these champions are very important. I think what characterizes them is that most of them are family-owned, have very long family tradition.
If you want to have another recipe, which is very close to what I said, it's that the German economy has started to become very open, and has also become very global in the last three decades. So I think it's remarkable how the share of exports relative to GDP has increased since the early 90s. We have 25% exports to GDP about 30 years ago, now it's almost 50%. So we have realized that it's important to go global, to use opportunities that global markets can offer, and we've been very successful with this.
- What are the major internal obsticles for the Russian economic growth?
- I think what's really important is a stable legal system, when property rights are clearly defined. I think it's important for people who invest in a country from abroad that they can rely on stable, reliable legal system with no corruption. What I can see from outside, is that I think that's what investor think when they ask themselves: "Should I go to Russia?"
- Can you tell us a few words about relationship between Germany and Russian in economic sphere?
- I think Germany and Russia are long-term partners for decades. Siemens started this great relationship by building a telegraph system for Russia. We are long-term partners in economics, and I think that for both sides so far this has been a good cooperation. So I hope and I'm optimistic that this cooperation will continue.
- What will change in contacts with Russia after Angela Merkel will leave chancellor post?
- I assume that German foreign policy will not change fundamentally. Same parties will be in power. I think that Angela Merkel didn't have personal foreign policy, it's a policy of the German government. Even if the SPD might be no longer in the government, which we don't know right now, but I don't think that whatever political changes in Germany will have any impact on the relations between Germany and Russia.
