ABSTRACT
Nearly all those who have looked at German1 policy towards transnational portray a ‘liberal’ climate (for example, United Nations, 1983; Safarian, 1993). In support of this view, one can note the absence of any formal review process for inward or outward investors, the range of incentives available to inward investors, and the fact that few sectors have been protected from foreign transnationals. Whilst the 1961 Foreign Trade Law (Aussenwirtschaftsgesetz, or AWG) empowered the government to restrict inward and outward investments in order to fulfil its international commitments, to preserve economic stability, and for national security reasons (Brücher, 1967; United Nations, 1983), the Department of Trade and Industry (1989) notes that available powers have not been used. Inward investors have simply had to notify the Bundesbank for statistical purposes if they acquire 20 per cent or more of the shares in a German enterprise (Haggeney, 1976; communication from Dresdner Bank 6/5/92). The degree of penetration of German industry by foreign-owned firms may be seen as further evidence to support this assessment of a liberal climate. For example, Safarian (1993) gives figures on employment and output of foreign-controlled firms in German manufacturing for 1977 at 17 per cent and 26 per cent respectively. Indeed there seems to have been a perception amongst some in Germany that such openness has been a major factor in post-war German economic success (see Haggeney, 1976 as one example).
