I come from a developing economy (Mxico) a bi g economy wi th bi g

dependence ties wi th the Unit ed St at es, a mediocre growth rate, and

worri some ri sing numbers in criminalit y, its not surprising t hat my arri val
to Bavari a was one of t he most impacting soci al experi ences Ive ever had,
not onl y I arrived to a country that holds the economi c growt h of the euro -
zone but to the most prosperous stat e of that count ry, Bavari as economy is
outst anding and independent in many poi nts of Germanys economy, its GDP
ranks among t he bi ggest of Europe
1
, in what export s are concerned, Bavari a
ranks ahead of such countries as Brazil, Sweden or Australi a
internati onall y
2
Bavaria has ranked as the German st at e of Germany with
the lowest unemployment rat e at j ust 3. 4% whi ch is al so the lowest of the
stat e i n over 20 years, moreover Bavaria boasts t he nation' s highest exports
at $214 bil lion whi ch is the hi ghest in Europe,
3
job creation grows st eady
and more importantl y thi s growth is not supported by forei gn investment
but by l ocal companies large, and medium, the investment in technology i n
all areas and the public expending in key areas of development have given
Bavaria t he stat us i t holds as one of t he most prosperous and growing
economies in the world, what int erests me is knowing t he governmental
planning behind thi s history of success, for an st udent who was obli vious of
German economy l i ttle more Bavarian economy unti l a year ago t he
knowledge of t he know how results basic i n the quest for understandi ng
how governance and pol ici es work in different regions of t he worl d,
hopefull y st ori es li ke the Bavari an example have follow ups in count ri es
such my own where publ ic expending at the moment is poorl y appli ed,
technology investment is barel y unexisti ng when we compare it wit h other
nati ons, and the not ion of a strong st at e with capacit y of action is stil l
feared among those with the littl e int ell ectual l eft overs of Reag aneconomi cs

1
http://www.statistik.baden-wuerttemberg.de/Statistik-
Portal/de_jb27_jahrtab65.asp
2
http://www.bayern.de/A-Dynamic-Economy-.604/index.htm
3
http://www.bavaria.org/news.mvc?c=current&p=2&id=665
that rei gned during the 80s and 90 in Mexico, for t hat matter and many
others I will give mysel f the t ask of knowing as much as possi ble about t he
program of governance and public policy of t he St ate of Bavi era.

Background.
From todays perspective its undeni abl e how the late industralization of
Bavaria served as a point on it s favor lat er on, Bavari a and its nei ghbor
Baden-Wrttemberg were historicall y known as agri cultural regi ons that
lacked many natural recourses that never experiment ed the same dregree of
growth i n thei r heavy i ndustrial i nfraest rucutre on previous cent ur i es as t he
rest of Germany and Europe, all thi s changed aft er the second world war
Post -war Bavari a benefited from being under Ameri can occupation, and
companies such as Si emens relocat ed from Berlin to Munich.
in the fut ure it was possibl e to buil d a modern infraestrucut re latti ce
whitout t he obst acl e of the old i nfraestrucutre, the arri val of refugees
especi all y from the bal cans and turkey as well as the rel ocati on of
companies Aft er the process of reuni fi cati on of divisi on of the country
many of i ts companies went thru several changes and overhauling that
changed many of the economi c dynami cs that had exist ed so far, all this
changes brought not onl y new i nvestment but new manpower and economi c
pot enti al t o t he st at e, compani es like Si emens, Osram, Agfa and Audi, for
exampl e, are companies t hat relocat ed thei r headquarters t o Bavari a aft er
Germanys di visi on.
Bavarias politi cal class took this opportunit y as a chance t o change the
face of t he st at e and the future of Bavari a, the st at e saw the breakdown of
its mini ng, t extile, clothing and porcel ai n industries in the eve of the new
tech indust ri es, and technology orient ed investments, today t he menti on of
Bavi era sti ll recall s images of bi g crowded beer halls, gi rls in dirndl and
men i n l ederhosen however Bavi era and its capit al Muni ch have evolved
into becomi ng t he europes answer t o sil icon Vall ey, as we stat ed it hasnt
been easy, t he st at e had t o build up a reput ation of its own in advanced
manufacturing in t he post war years, for exampl e the state was heavil y
affected in the 1990s by t he 1993-1994 recessi on whi ch deepl y harmed it s
export ori ent ed industry, adding to thi s the drop of demand of defense
equipment and aerospace indust ry which was one of the regi ons st rong
point s, as the col d war came t o and end.
Despit e of its economic development cul turall y Bavari a is a est at e proud of
its hi story, Mi chael Hint erdobler, di rect or of int ernational rel ations at t he
stat e chancell ery, says both Bavari as are thrivi ng: "There has been a
renaissance. Young peopl e go out wit h t hei r iPod but also have a dirndl at
home. It ' s not a contradi cti on any more. " Ive witnessed t his so call ed
cult ural renaisance with especi al att enti on.
The region around Muni ch generat es a total thi rd of the GDP of the state,
with compani es prescence such as BMW and MAN but as we pointed out
with the st rong prescence of hundreds of small er biot ech companies, IT and
environment al tech firms that have sprung in the l ast coupl e of decades,
such as linguat ec an automati c transl ation company, and greenrobots a tech
company t hat develops apps such like qui ck search.
The solution of the Stat e of Baviera
The goverment of Bavi era creat ed as an answer t o the economic downfall a
program called CLUSTER-OFFENSIVE BAYERN The st at e of Bavari a
came to the rescue, selli ng 2. 9bn (2. 5bn) of shares in government -owned
energy and infrast ruct ure companies and pumping the bulk of it int o
initi atives t o nurture hi -t ech indust ri es. Bayern Kapi tal , a subsidiary of LfA
Frderbank Bayern, Bavari a' s st at e bank, was est ablished with 75m in
stat e money t o provi de venture capi tal for st art -ups, especial l y i n t he r isky
hi-t ech sectors.
The pl an li es i n t he support of Bavari an government t o 19 sect ors of t he
economy.
Mobilit y: Aerospace, automot ive, railway technology, logisti cs.
Mat erial development: chemist ry, nanot echnology, new materi als.
Peopl e and enviroment: t echnology, energy t echnology, nutrition, forest ry
and wood, medi cal, enviroment technology.
Information and el ectri cal engi neering: information and communi cation
technology, power el ectroni cs, mechat ronics and aut omation, sensors.
Also Bavaria government creat ed in the year 2000 t he program Hi gh Tech
Offensi ve Bayern.
The Bavari an government gave answers to the economic chall enges of the
21st century. The projects were approved and t he offensi ve start ed in the
year 2000 to 2005, and the so-call ed substitut es projects up to 2009

As part of thi s Proj ect a tot al of 274 proj ects with around 1. 45 billi on euros
were funded in four columns and a communit y investment program, of
whi ch 74 projects with 1. 267 billion euros in the col umns 1, 3, 4 and t he
location program (so-call ed . Champions League) and 200 projects wit h 179
million euros i n the col umn 2 (so-cal led regional proj ects).

Martin Zeil, Bavari a' s former deput y prime minister and minister for
economic affai rs, admitted Germany is "far behi nd" in t erms of developi ng
a venture capit al i ndust ry, l oans are grant ed to compani es small and
medi um-sized firms, but a factor i n the Bavarias success is t he network of
13 universiti es and publi c research organi sati ons such
"Money was put into uni versit ies, t echni cal colleges and institutes of
applied sci ence, there was al ways a network, " sai d Zei l. "What at tracts
forei gn i nvestors is this network. " More than 50, 000 peopl e work i n
research fi elds and Muni ch has had the hi ghest rat e of thechnology patents
percapita in Germany, Bavaria as Sili con Vall ey i n t he Unit ed states shift ed
from traditi onal rural areas in to power houses of thecnology in the l ast 50
years.
One example of industri al success can be found in the solar t echnology, the
reason why Germany has deci ded t o close all its nucl ear reactors by 2030
its because the sol ar panels and t echnol ogy used i n Germany it s actuall y
creat ed t here, the cost of product i on and development went down as t his
technology became more widespread used and the feed-in tariff was
incl uded i n the government program, this means t hat induviduals can
produce thei r own solar energy and any surpl us goes back to t he mai n
el ect ri c net , t his surplus is l at er payed by the german government .

Political aspects.
Bavaria is generall y considered as a bastion of poli tical conservati sm in
Germany, because of the soci al st and in liberal topi cs despit e of this
Bavaria st at e is the onl y one in Germany where the count ry' s largest part y,
the centre-ri ght Chri stian Democrati c Union led by successful chancellor
Angel a Merkel is not present at all instead, its sist er part y call ed the
Christian Soci al Uni on whi ch has a coali tion i n t he bundest ag wi th Markel
takes the CDU' s rol e i n Bavari a, the t wo part ies rose out of the confusion
and chaos of the postwar years when Catholi c and conservati ve parties
merged to form new movements, si nce t hen t he CDU and CSU have kept
thei r separat e ident it ies
Transport ation and publi c servi ces.
Bavaria as the rest of Germany has an extensive net of hi ghways and
rai lways, the rai lway syst em propert y of Deutsche Bahn connects the mai n
citi es of t he stat e, even tough DB is not Bavarian it s a great exampl e of a
parti all y publi c owned company wi th successful economi c resul ts and an
ambit ious pl an of expansion.
Education:
Education in Bavaria as in Germany is compulsory children must
attend school for at least twelve years. An apprenticeship, and
therefore attendance to a vocational school, may be included,
parents in all cases are obligated to send their kids to school.
Health.
As State of Health, Bavaria provides a promising and future -oriented
location of health care. Regarding qualit y and medical care, Bavarian
healt h services are amongst the worlds best. Already in 2005, the
Bavarian State Government agreed upon an extensive package of
measures in order to develop its potential systematicall y on a global
level, Bavaria ranks in the top spots Worlwide of phisicians per capita
Economi c results
Nowadays Bavari as economy is conformed as a mixed economy, 32. 9% its
servi ces rel evant to business, 24. 7% t o i ndust ry and manufacturi ng, 18, 9%
publi c and privat e sector, 17, 6% trade, t ourism, and t ransport , 4. 6%
construction, 1. 3 farming and forestry.
4

Economy growth.
Bavarias economy has had an steady growth rat e, from 1995 t o 2005 the
stat e has experimented an expansion of 28. 2% of it s GDP, this result i s
admi rabl e compared to the 14, 6% that the whol e Germany experiment ed i n
the same peri od.
GDP percapit a.
Being one of the best i n Europe at 32, 400 euros compared to 27, 000 of
Germany.
5

Conclusi on.
Bavaria i s indeed the most prosperous st at e of Germany it s success li es i n
the const ant i nnovati on of its companys and the support of t he government
in the i nnovation fi eld, a hi gh t ech st ate would not have been possibl e
without a st rong st at e supporting a proj ect for t he future, the localization,
and histori cal cont ext may have given a littl e advant age to Bavi era over
other parts of t he world, however t heres not hi ng that can compet e with t he
will and hard work of a st at e that is deci ded t o become t he best exampl e of
Germany to the Worl d, for countries like my own t he unexisti ng seriousness
of government programs for long t erm grows like a cancer, short term
resul ts are understood as the onl y possibl e scenario i n politi cs, i f this

4
http://www.bayern.de/A-Dynamic-Economy-.604/index.htm
5
http://www.bayern.de/A-Dynamic-Economy-.604/index.htm
mindset dont change its impossi bl e that countri es li ke mine can begin
industri al revoluti ons like t he one Bavari a made.