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Man and woman with face mask. Man and woman with face mask. | © GettyImages/martin-dm

Coronavirus and Germany

Lifts on Covid-19 restrictions buoy economic outlook

Moderate levels of Covid-19 infection allowed the German government to ease most restrictions this spring. Thanks in part to that, the German economy is expected to recover throughout 2022, despite disruptions to global supply chains because of Russia’s ongoing war on Ukraine and continuing restrictions as part of China’s zero-Covid strategy.

Growing domestic and international demand for products and services “Made in Germany,” combined with robust market, should encourage German economic resurgence.

Germany Trade & Invest is working for you – with regular information updates and answers to your questions about your business expansion to Germany. Our industry teams provide ongoing support and are happy to connect with you – in Germany and around the world.

National Corona Regulations

  • Since the beginning of April 2022, most pandemic restrictions in Germany have been lifted.

Germany has entered a new phase of the coronavirus pandemic with the removal of most protective measures after a period of two years. The updated Infection Protection Act contains basic measures such as the wearing of protective masks on buses and trains and in hospitals and care facilities. It also provides for precautions in the event that the coronavirus situation comes to a head in individual regions. 

Basic protection  

Certain basic protective measures - such as mandatory masks and testing - remain in  place in nursing homes, outpatient care and hospitals. The requirement to wear a mask in buses and trains will also continue to apply.

The federal states can impose further protective measures in the event of a local infection threat situation. This is subject to a resolution issued by the respective state parliament.

Workplace rules

The Covid-19 specific occupational health and safety regulation expired on May 26, 2022. There are currently only generally binding requirements for certain industries and activities - particularly in the areas of medical care, nursing and care for the elderly.

In accordance with the Occupational Health and Safety Act, employers still have a duty to conduct a risk assessment for their business and consider what measures are needed to protect their employees. The assessment must be constantly adapted to the current infection situation. Employers no longer have to offer testing or home office options to employees.

Covid-19 testing

From June 30, 2022, rapid antigen tests for asymptomatic persons are no longer free of charge for most citizens in Germany. Exceptions apply to the following groups:

  •   Persons who cannot be vaccinated for medical reasons
  •   Infected persons who want to be released from quarantine
  •   Household members of infected persons
  •   Visitors in hospitals or residential care facilities.

Subsidized tests, also for asymptomatic persons, are available at the cost EUR 3 for the following groups:

  •  Visitors of same day indoor events
  •  Persons who have received notice of “increased risk” on their Corona warning app
  •  People intended to visit a person that day who is at high risk of severe illness from a Corona infection.

For detailed information about testing in Germany, please refer to the dedicated website of the Federal Ministry of Health

Useful further information

For further information on the federal level measures, please refer to the government’s website linking to the corresponding websites of the federal states (in German only). 

Additionally, the special information website for the Corona virus provided by the Federal Ministry of Health offers useful information.

Entry Regulations and Travel Restrictions

As of June 11, 2022, all COVID-19 entry restrictions to Germany have been temporarily lifted.

Entry restrictions - who can enter Germany?

As of June 11, 2022, all Covid-19 entry restrictons have been temporarily lifted. From this date, entry to Germany is once more generally permitted for all travel purposes. This means that travelers may enter Germany for any valid purpose, e.g. business trips, tourism or for family visits provided that they meet the general requirements of residence law. For information on visa and entry regulations please refer to our Investment Guide.

However, persons residing in the People's Republic of China still require an important reason to enter Germany (due to reciprocity). For detailed information please see the dedicated website of the German Federal Foreign Office

Additional entry restrictions also apply to virus variant areas - however, there are currently no states designated as virus variant areas. 

Requirements when entering Germany

For entry into Germany, proof of vaccination, proof of convalescence or proof of testing is no longer required.

Exempted from this are any entries from virus variant areas for which extended regulations still apply. There are currently no states designated as being virus variant areas. For detailed information please refer to the dedicated website of the Federal Foreign Office.

Current Economic Developments

Despite current developments including the war in Ukraine and coronavirus returning to China, Germany’s economy is still expected to grow - albeit at a lower level than forecast earlier this year.

The current economic situation

A number of economic analyses forecast 2022 as the year of strong recovery for the German economy after the coronavirus pandemic. The economic effects of the global pandemic have been less severe in Germany than previously expected. The federal government's comprehensive and rapid support for companies since the beginning of the crisis has proven effective to date. A resumption of social and economic activities - with the removal of restrictions - is stimulating the economy.

The situation in the service industries has brightened significantly, with positive developments signalled in the retail trade and hospitality sectors in particular.

German industry can also look to well-stocked order books and worldwide demand for German goods, with exports increasing by almost 10 percent in 2021.

The domestic labor market is also showing signs of recovery. Many job openings led to a significant decrease in rates of unemployment. The Federal Employment Agency reports an unemployment rate of five percent at the end of April 2022 compared to six percent in April 2021.

However, the ongoing Russia-Ukraine conflict has adversely impacted on the previously high confidence levels of just a few months ago - particularly in German industry.  Sanctions imposed on Russia will have a negative impact on the domestic economy and consumption. Supply chain disruptions and increased prices are dampening near-term growth prospects.

Revised expectations

According to data published by the Federal Ministry for Economic Affairs and Climate Action (BMWK), Germany’s GDP grew by 2.9 percent in 2021, having declined by 4.6 percent in 2020. Before the start of the war in Ukraine, the German government expected growth of 3.6 percent for the year 2022. This projection was recently revised to 2.2 percent.

Forecasts made by the European Commission (EC) have also been revised. This resulted in significant reductions of GDP projections for the vast majority of European member states. The EC also points out the economic improvements in Germany as mentioned above, but is more sceptical of the impact the Ukrainian war will have on the economy. According to the EC, Germany's economy will grow at a rate of 1.6 percent in 2022.

FDI perspectives

Having felt the impact of the severe global economic downturn caused by Covid-19 in 2020, Germany recorded a nine percent drop in FDI projects two years ago. Fortunately, 2021 saw a big comeback as Germany Trade & Invest recorded a seven percent increase that elevated greenfield project numbers to 1,806.

Germany’s reputation as a FDI safe haven helped maintain stability in an otherwise unstable environment. In 2020 and 2021, Germany received the majority of greenfield projects in Europe. The country's  reputation as Europe’s most attractive business location helped to keep the slump within limits and generate better results than previously expected.

For more information please see the results of the GTAI 2021 FDI Report.

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