Positioned at the very heart both of Western Europe and Germany, Saxony-Anhalt – the eighth largest of Germany’s 16 federal states – boasts an enviable strategic location. There’s a lot more to do Saxony-Anhalt’s appeal than just location, however – a fact that’s being increasingly recognised by investors from every corner of the world.

Saxony-Anhalt – discreetly popular
While not perhaps a household name outside Germany, the landlocked federal state of Saxony-Anhalt in eastern Germany is held in high regard among those with an eye on Europe’s leading investment location The region is especially popular among companies involved in chemicals, bio-economics, mechanical engineering, energy, resource efficiency, food and agriculture, health and medicine, and mobility and logistics. And there are good reasons for its popularity.

The basis of the popularity
Why do companies choose Saxony-Anhalt? Even in comparison to other German states, Saxony-Anhalt offers something more. This includes exceptional value when it comes to real estate and production costs – in fact, Saxony-Anhalt has among the lowest production costs of all industrialised German states. In addition, potential investors can also be assured of swift realisation and approval times of investment projects. “For investors, Saxony-Anhalt offers the best prospects. Its central location right in the middle of the European Market, its state-of-the-art infrastructure, the availability of a highly skilled and motivated workforce, an attractive cost structure including funding opportunities and an outstanding research landscape make it a hotspot for foreign direct investment,” says Dr. Carlhans Uhle, who heads up the state’s economic development agency IMG (or the Investment and Marketing Corporation). Another strength is the region’s superb transport and logistics infrastructure, with its 600 kilometers of navigable inland waterways, 18 ports and inland terminals, almost 11,000 kilometers road network, connections to the key pan-European transport routes, and a superb rail network.

IMG: professionalism and expertise
And if all that’s not enough, there’s more. For many foreign investors, one of the biggest draws is the professionalism and expertise of Saxony-Anhalt’s economic development agency IMG – or, to give it its full title, the Investment and Marketing Corporation Saxony-Anhalt mbH. The agency was recently awarded the Best to Invest Top Agencies 2015 as best regional IPA in Western Europe , which came as no surprise to those familiar with what it does and what it has achieved. Simply put, it supports companies in every phase of the investment process. This assistance spans everything from site selection to advising on investment incentives: “We interact with the companies to help them identify location, infrastructure. We try to identify their issues and help them with paperwork, application for buildings, for incentives, educating people who come to work in Saxony-Anhalt and so on,” says its managing director Dr. Carlhans Uhle.

IMG sets out to provide investors with a single point of contact, alongside top-notch expertise in the relevant markets. The overall aim is to make the investment as easy, fast, efficient, and informed as possible. And investors can count on consistent, reliable, and individual service. Despite being a governmental agency, there’s a distinct entrepreneurial spirit and character to IMG, which ultimately benefits its clients.

The fruits of IMG’s labour
With this in mind, it’s no surprise then that Saxony-Anhalt experienced a 114 percent increase in inward investment by foreign companies between 2012 and 2013, according to analysis from Ernst & Young’s annual European Investment Monitor. In all, 30 foreign companies invested in the state in 2013, whether to establish a new operation or expand an existing one. This performance places Saxony-Anhalt in pole position in terms of inward investment among the federal states of the eastern part of Germany, and in sixth position overall in Germany. According to IMG’s Dr. Uhle, “this success is a substantial confirmation for the dynamic development of Saxony-Anhalt as an industrial location.”

However, the appeal of Saxony-Anhalt as an investment location is showing particularly strong growth among British interests. There are currently around 60 British companies with a presence in Saxony-Anhalt, and British investment over the course of the last decade or so has totaled around €165 million. British companies tend to be particularly drawn by the region’s high technological standards, as well as the calibre of the workforce, the managerial acumen and the stable framework conditions. There’s also a healthy line of trade between the UK and Saxony-Anhalt: in 2013, exports from Saxony-Anhalt to the UK were worth around €920 million (which was around 6 percent of the state’s total exports), while imports from the UK were valued at around €775 million. This has created a valued and trusting relationship that looks set to grow further in the years to come.

Traditional and emerging industries of Saxony-Anhalt
Many people who are familiar with Saxony-Anhalt associate it with IT. There are several IT giants active in the region, including Deutsche Telekom’s T-Systems, which located Germany’s biggest cloud data centre in Saxony-Anhalt. The US company IBM opened its first European service centre in Magdeburg, which was a departure from the traditional corporate strategy of contracting out software development and IT services to Asia or South America. Other prominent industries include mechanical and plant engineering. This sector is led by the likes of AGCO, Trimet Aluminium, Nemak, Novelis and Befesa Aluminium. In addition, its life sciences industry – encompassing the pharmaceutical industry, biotechnology, and medical technology – is similarly robust. Pharma giants like Bayer, Salutas Pharma and IDT biologica are also contributing to the success of the Life Science sector in Saxony-Anhalt, as well as the very strong and innovative medtech landscape with a symbiotic network with research companies, production locations and university education are working hand in hand along the entire value chain. Another buzzing industry in Saxony-Anhalt is the renewable energies sector. Within the region, every third kilowatt hour comes from renewable energy (primarily wind energy).

A dynamic economic area that’s attracting attention
Given all that it has to offer as an investment environment, it is not surprising that the federal state of Saxony-Anhalt is attracting more and more interest from foreign investors. Without exaggeration, it could be said that it’s the region with everything – everything except, perhaps, a high level of mainstream awareness overseas. That, however, as the data suggest, is changing fast. Saxony-Anhalt is a dynamic, vibrant economic area offering itself as a dependable investment partner. If you’re looking for a top-class investment location, look no further – you’ve found what you’re looking for!