When West Germany experienced its great post-war industrial expansion, Berlin was not really part of it. The city was divided, isolated and caught between two economic systems. West Berlin had several major employers, supported by extensive public subsidies. But after the construction of the Wall, many companies moved their headquarters, research departments and investment activities to West Germany. What remained was often labour-intensive production, sustained in part by special assistance rather than by the dynamics of the Wirtschaftswunder. In East Berlin, meanwhile, economic development followed the wider trajectory of the GDR: central planning, large state-owned combines and, increasingly, outdated production structures.
The consequences continued after reunification. The end of subsidies in the West coincided with the collapse of the industrial combines in the East. Berlin’s industrial workforce fell from around 378,000 in 1989 to fewer than 100,000 in 2007. Although the city’s industry has since modernised and begun to grow again, its industrial employment density remains lower than that of other major German urban regions. Berlin’s own economic administration describes this history as one of decline followed by an industrial renaissance.
Unlike Munich, Stuttgart or other centres of the West German industrial economy, post-war Berlin developed no convincing story of self-generated prosperity.
This history created more than an economic disruption. It also produced a remarkably persistent narrative. Unlike Munich, Stuttgart or other centres of the West German industrial economy, post-war Berlin developed no convincing story of self-generated prosperity. The city was seen as subsidised, politically exceptional and economically dependent. After reunification, this image was replaced by another: Berlin as a capital of government, culture, nightlife and, eventually, start-ups—but still not as a city that produces industrial value.
That narrative came to mind when I attended the presentation of the short study Berlin2037: A Strategic Impulse for an Effective Economic Policy. Its central message is simple: Berlin does not have a potential problem. It has a problem converting its potential into innovation, investment, value creation and good jobs.
Based on 25 interviews and two workshops with members of Berlin’s business community, the study uses strategic foresight to look beyond the next electoral cycle. Its horizon is 2037, the 800th anniversary of Berlin. It identifies five fields with particular international potential: health, intelligent mobility, climate-neutral infrastructure, digital sovereignty and artificial intelligence, and technologies for resilience and security. The study presents these fields alongside 20 packages of measures and 39 proposals for the first hundred days of a new government.
Its most persuasive argument is that successful economic policy cannot end with supporting research and founding start-ups. Berlin must develop complete pathways from scientific discovery to commercially successful companies. That means connecting universities, intellectual-property rules, test facilities, public procurement, growth capital, industrial space, housing and skilled labour.
Among the proposals are five clearly led “value-creation missions”, a Berlin Future Fund combining public and private capital, more effective transfers from universities, and an efficiency law under which reporting requirements would have to demonstrate their usefulness. The city itself should become a testing ground and first customer for new technologies—from healthcare innovation to autonomous mobility and resilient infrastructure.
At the launch, these ideas were discussed by three members of the Berlin House of Representatives: Tuba Bozkurt of the Greens, Florian Dörstelmann of the Social Democrats and Lucas Schaal of the Christian Democrats. Their exchange was constructive and strikingly cross-party, although not without a few refreshing jibes at one another. Berlin is already in election mode.
The challenge is to retain enough of the value created in Berlin so that it can be reinvested in the city and generate further growth.
Tuba Bozkurt raised a particularly important question: How can Berlin ensure that scaling start-ups do not simply leave the city after being acquired by international investors? Attracting investment is not enough if intellectual property, profits and future strategic decisions subsequently move elsewhere. The challenge is to retain enough of the value created in Berlin so that it can be reinvested in the city and generate further growth.
The study is an intelligent strategic impulse, although not a fully costed economic programme. Its strength lies in connecting fields that are too often discussed separately. Its weakness is that it cannot yet demonstrate which proposals would create the greatest economic return—or how competing priorities should be financed.
Berlin’s industrial economy is therefore not an imaginary future. Important parts of it already exist—but the city has not yet learned to see them as elements of a common story.
What is dramatic, however, is how long an economic narrative can survive after reality has begun to change. Berlin is already home to one of Bayer’s most important pharmaceutical research and production sites, employing around 5,000 people. Siemens is developing a major technology and industrial district in Siemensstadt. BMW’s Berlin plant is the global lead facility for its motorcycle production, while Mercedes-Benz is transforming its historic Marienfelde plant into a centre for digital manufacturing and electric-drive technologies. Just beyond the city boundary, Rolls-Royce develops, tests and manufactures aircraft engines in Dahlewitz.
Berlin’s industrial economy is therefore not an imaginary future. Important parts of it already exist—but the city has not yet learned to see them as elements of a common story. If inherited narratives can make real economic strengths almost invisible, what else might Berlin—and Europe—already possess without fully recognising its value?
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