Victoria-Germany – Market Snapshot
As the world’s fourth largest, the German economy is highly developed and robust.
Germany boasts one of the most robust and dynamic economies in the world, characterised by a high degree of innovation, efficiency, and productivity. As the largest economy in Europe and the fourth largest globally, Germany's economic landscape is underpinned by a strong industrial base, a highly skilled workforce, and a commitment to research and development.
The country is renowned for its advanced manufacturing sector, particularly in the automotive and machinery industries, which are globally competitive and contribute significantly to export revenues. Additionally, Germany's economic stability is supported by a diversified economic structure, including a vibrant services sector that encompasses finance, healthcare, and information technology.
Sectoral strengths further delineate Germany's economic strengths. The automotive industry is a cornerstone, with major companies such as Volkswagen, BMW, and Daimler leading in both traditional and electric vehicle markets. The machinery and equipment sector is equally prominent, known for producing high-quality, precision-engineered products that are integral to various global industries.
Germany also excels in chemical production, with companies such as BASF and Bayer at the forefront of innovation. Furthermore, the renewable energy sector is rapidly growing, bolstered by strong government support and technological advancements, positioning Germany as a leader in sustainable energy solutions. This combination of sectoral strengths not only fuels economic growth but also enhances Germany's resilience in the face of global economic challenges.
Victoria’s economic relationship with Germany is strong
Victoria values its long-standing, multifaceted relationship with Germany covering trade and investment, research collaboration as well as strong people-to-people and cultural ties.
Victoria’s trade and investment relationship with Germany is significant and with an already strong base, there are growing opportunities to further grow our bilateral economic relationship in the future.
With two-way merchandise trade valued at $6.2 billion in 2022-23, Germany is not only Victoria’s largest two-way trading partner in the European Union but also the State’s sixth-largest trading partner globally.
Victorian firms benefit from access to Germany’s vast market and technological expertise. Victorian exports to Germany totalled $481 million in FY2022-23 led by the following top exports: oil-seeds and oleaginous fruits worth $161.8 million; pharmaceutical products (excluding medicaments) totalling $89.1 million; and specialised machinery and parts worth $32.2 million.
Over the FY2022-23, the value of Victorian merchandise exports to Germany grew by 9 percent ($38 million), largely due to a $27 million increase in pharmaceutical product exports.
Imports from Germany into the State totalled $5.8 billion led by passenger motor vehicles ($1.1 billion); agricultural machinery and parts ($571.1 million) and tractors ($164.2 million).
With Victoria’s diversified economy, strategic location and world-class universities and research institutions, the State is an attractive destination for German investment, particularly in sectors including renewable energy, transportation and warehousing and biotechnology. Over the five-year period between FY2018 and 2023, Germany was the sixth largest source market of foreign direct investment (FDI) into Victoria, worth $1.53 billion and has created over 900 jobs.
Major German businesses operating in Victoria include BayWa, BioNTech and DHL with historic investors also including Siemens, Allianz and Deutsche Bahn. Opportunities for further German investment into the State is also visible in renewable energy, biotech and advanced manufacturing.
This dynamic economic relationship with Germany is underpinned by the fact that 25,365 Victorian residents were born in Germany according to the 2021 Census. Furthermore, Victoria welcomes a significant number of international visitors from Germany every year (totalling 54,700 in 2023 approximately double the number of the previous year).
Victoria and Germany: A collaborative partnership
The Victorian Government maintains close working relationships with the Embassy of Germany in Canberra, the Honorary Consulate of Germany in Melbourne and Germany Trade and Invest (GTAI) — the international economic promotion agency of the Federal Republic of Germany.
The Victorian Government also works closely with the German-Australian Chamber of Industry and Commerce (AHK Australien) with its Melbourne office based at International Chamber House, to foster further connections and international business opportunities.
Germany’s second-largest metropolitan region, Frankfurt Rhein-Main established a representational office in Australia in April 2024 through a partnership with the German-Australian Chamber of Industry and Commerce.
The region, which contains the global financial hub of Frankfurt, has a population of 5.8 million people and ranks as the European Union’s fourth-largest region by GDP.
Global Victoria looks forward to working closely with Frankfurt Rhein-Main to grow their Australian presence.
Victoria’s enhanced presence in Europe, under the leadership of Victoria’s Commissioner for Europe, the Middle East, Türkiye and Africa, Gönül Serbest and through the newly established Victorian Trade and Investment office for Europe in Paris, leads the State’s engagement with Germany and is supported by an investment office in Frankfurt.
The new office is enhancing the State’s engagement across the region and supporting Victorian companies to expand to the dynamic European market, including Germany.
Since opening in 2023, the Paris office has delivered several trade missions to Europe, including Formnext in Frankfurt.
Recent activities
Global Victoria was delighted to host Martin Kent, His Majesty’s Trade Commissioner for Asia Pacific on Friday.
With an introduction by Global Victoria’s Ema Lawrence, Martin gave a comprehensive overview of the new UK Government’s trade priorities with the region and their implications for Victoria.
With the Australia-UK Free Trade Agreement now in force, we look forward to working with Martin and his UK in Australia team to further strengthen Victoria’s dynamic trade and investment relationship with the United Kingdom.
Many thanks to our event partners, Steph Lysaght, the British Consul General in Melbourne and Matthew Joyce from the Australian British Chamber of Commerce .