Selling to the Government
Selling to German government entities is not an easy process. German government procurement is formally non-discriminatory and compliant with the WTO Government Procurement Agreement (GPA) and EU-wide legislation under the EU Public Procurement Directives. That said, it is a major challenge to compete head-to-head with major German or other EU suppliers who have established long-term ties with purchasing entities. For information on EU procurement, please refer to the article on in the Country Commercial Guide for the European Union – Selling to the Public Sector.
U.S. companies bidding on foreign government tenders may also qualify for U.S. Government advocacy. Within the U.S. Commerce Department’s International Trade Administration, the Advocacy Center coordinates U.S. Government interagency advocacy efforts on behalf of U.S. exporters in competition with foreign firms in foreign government projects or procurement opportunities. The Advocacy Center works closely with our network of the U.S. Commercial Service worldwide and inter-agency partners to ensure that exporters of U.S. products and services have the best possible chance of winning government contracts. Advocacy assistance can take many forms but often involves the U.S. Embassy or other U.S. Government agency officials expressing support for the U.S. exporters directly to the foreign government. Consult the Advocacy Center’s program web page on trade.gov for additional information.
Financing of Projects
Germany possesses the financial framework and institutions to support the development of large infrastructure projects. However, the volume of project finance operations has been relatively modest in Germany in comparison to that of other EU countries. Inhibiting factors are Germany’s complex juridical and federal frameworks, which make project-financed works harder to structure than in other countries. Low interest rates and returns on savings have contributed to an improved investment climate. One area that has attracted project finance, including that involving a few U.S. developers and investors, is alternative energy production. Clean and renewable energy projects have gained prominence in Germany, particularly since the phase-out of nuclear energy, the decision to end coal power generation by 2038, and pressure to reduce reliance on Russian energy following the invasion of Ukraine.
The principal German institutions active in facilitating project finance deals are the state-owned KfW Bank Group (which plays a major role in most industries), commercial banks such as Commerzbank, and several of the publicly-owned savings banks controlled by state and local governments and state development banks (“Förderbanken”, in German), such as WIBank in Hesse, NRW.BANK in North Rhine-Westphalia, LFA Förderbank Bayern, Investitionsbank Berlin (IBB), among others. The KfW Group includes KfW IPEX-Bank, which supports a consortium with German members to design and finance infrastructure projects in Germany and overseas, and KfW Capital, launched in October 2018 to develop the VC and VD funding landscape in Germany and Europe. Another group member, KfW Development Bank, helps municipalities finance infrastructure. German insurers are pressing for regulatory changes to enable them to finance infrastructure projects.
Key Link: European Bank for Reconstruction and Development (EBRD)
Key Link: U.S. Commercial Service Liaison Office to the EBRD