Research & development Jan 27, 2016

Bavaria continues on its path to success

2015 was another successful year for the Bavarian economy. Growing constantly, the state's gross domestic product rose by 1.7 per cent, and even higher growth is forecast for 2016. Measures for medium-sized companies and digitization are supporting this trend.

Bavaria – the state for start-ups

Bavaria has launched an initiative to help it become the number one state for start-ups.  In 2015, financing facilities were expanded, measures like the business plan competition relaunched and EUR 80 million invested in the business incubator initiative.

Werk1.Bayern was officially opened in the middle of last year. The plan is to transfer the successful concept of the digital start-up hotspot in Munich to every administrative district in Bavaria. Werk1.München will act as a kind of pioneer business incubator. But that is not all: many of the other business incubators in Bavaria that are committed to supporting start-ups are also expanding the services they offer. The successful BioCubator Straubing, for example, will expand its premises with the support of the state, offering young companies from the regenerative raw materials sector additional laboratory space for putting their innovative ideas into practice. Start-ups in Upper Palatinate are also benefiting from active support. In 2016, TechBase in Regensburg will replace the IT-Speicher as a business incubator, offering a modern infrastructure for technology-based companies and research institutions that work closely with industry. The building will provide office, workshop and research space, a cafeteria, and seminar and conference rooms on an area of around 20,000 m².  All the incubators in Bavaria share a common goal: to offer enough space for open communication with other companies from different sectors and to open the door to an established network.

Driving digitization forward

Bavaria has really hit the nail on the head with all the initiatives and strategies being continued in 2016. A study by vbw has shown that ongoing digitization is one of the factors that makes the biggest difference to economic growth. The authors name the following points as important in order to secure and strengthen the location:

•    Making use of digitization as a crucial factor in growth

•    Optimising research and development

•    Promoting start-ups and company settlements

•    Expanding e-government services

The trade fair schedule for 2016 is all about digitization, too. NürnbergMesse, for example, will host it-sat, bringing this key highlight for the IT security sector back to Bavaria. Just like every year, Franconia will once again be the place to be for everyone involved in network security from 18th to 20th October. Digitization even plays part in Oktoberfest. Bits and Pretzels is unmissable for start-ups. Having started as a breakfast for entrepreneurs, it has grown into a three-day conference where entrepreneurs and other interested parties can inspire and connect with one another.

Attractive for big players

The big players also benefit from Bavaria's strategy. The American IT corporation IBM, for example opened an international competence centre for smart solutions for the Internet of Things and computers that think independently in Schwabing, Munich in 2015. The centre is a huge gain for businesses in Bavaria. Not only will it create 1,000 new jobs at IBM over the next few months – numerous Bavarian companies and young company founders will also benefit from the new facility in the years to come. The choice of location is no coincidence. Munich's outstanding reputation as a beacon of the information and communications industry, confirmed by an EU Commission study, attracts large numbers of investors – a fact also proven by the decision of the Chinese Alibaba Group to open one of its first two national offices in Europe in Munich last year. 

One of the key factors that benefits investors is Bavaria's outstanding infrastructure, which makes Munich in particular a transport hub in the heart of Europe. As part of ensuring this advantage for the location in the long term, the new satellite terminal at Munich Airport will open in early summer 2016, promising an additional capacity of eleven million passengers a year. Last but not least, the excellent quality of life in Bavaria generally and Munich particularly means that companies based here have no trouble inspiring young specialist staff to come here. This is an advantage that will benefit both IBM and many other investors in 2016.

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