Attractive Funding

© Getty Images/Tom Merton

Attractive Funding

Federal and state governments support investors seeking to invest in Eastern Germany.

Attractive funding and a number of grant options including low-interest loans, bank guarantees, and cash allowances are made available to investors in Eastern Germany. Labor, training, and R&D subsidies are also available in order to further reduce personnel and material costs.

As well as EU Structural Funds, prominent investment promotion position is taken by the Join Task for the Improvement of Regional Economic Structures (GRW) investment grant facility. Companies who intend to invest in the manufacturing, production-oriented services, and other related sectors can also expect support in the new EU funding period.

Available funding is subject to individual investment project plans and factors including company size, business location, and nature of the investment. A number of funding sources can be combined subject to specific investment criteria being satisfied. German innovation policy pays specific focus to the practical
R&D needs and requirements of SMEs who do not ordinarily have access to the same resources as large enterprises.

The “Entrepreneurial Regions,” “Central Innovation Programme for SMEs (ZIM),” and “INNO-KOM Ost” initiatives are just three programs making an important difference for SMEs in Eastern Germany. Entrepreneurial Regions Innovation Initiative The “Entrepreneurial Regions” innovation initiative promotes the formation of internationally competitive science-industry centers of excellence in Eastern Germany. Entrepreneurial Regions consolidates six programs (Centres for Innovation Competence; Innovation Forums; InnoProfile; ForMaT; Twenty20 – Partnership for Innovation; and InnoRegio) in one closely integrated financial support instrument to promote the special character of innovation in Eastern Germany.

The initiative stands for innovation-oriented regional alliances which develop the region’s identified core cluster competences along market-specific lines. Its goal is the sustainable transfer of these competences to innovations, economic growth and employment. In following these objectives, the “Entrepreneurial Regions” development programs establish the basis for the creation of internationally competitive, regional economic clusters. Central to each regional initiative is a clear innovation strategy geared towards the implementation of newly developed products, procedures and services in the competitive landscape.

Central Innovation Programme for SMEs (ZIM)

The Central Innovation Programme for SMEs (ZIM) is a nationwide funding program for SMEs and partner research establishments. ZIM has been open to all industry branches and technological sectors as a source of support for innovation efforts since 2008. The aim of ZIM is to sustainably increase the innovative capacity and competitiveness of SMEs including craft businesses and independent professions, and in doing so contribute to their growth and the generation of new jobs.

Individual Project Funding

Funding may be provided for R&D projects undertaken by individual companies including small and medium-sized companies in accordance with the definition of an SME and other SMEs with up to 500 employees including affiliated or partner companies.

Cooperation Project Funding

Funding may be provided for cooperation R&D projects undertaken by several companies or between companies and research institutes which are small and medium-sized companies in accordance with the definition of an SME; other SMEs with up to 500 employees including affiliated or partner companies; and public and nonprofit-making private research institutes. Cooperation projects can receive funding covering between 35-50 percent of costs. Grants payable to research establishments can cover up to 100 percent of costs.

Cooperative Network Project Funding

Grant funding is made available to cover share of network management personnel costs. This is equivalent to up to 90 percent of eligible costs in the first phase (up to one year) and phase two (with 70 percent in first year followed by 50 percent and 30 percent in years two and three respectively). Revised ZIM guidelines were published in April 2015. Applications can be submitted continuously through until 31 December 2019.

INNO-KOM Ost ("Innovation Competence East")

In order to hold their own in international competition, small and medium-sized enterprises need access to research facilities whose R&D activities are specifically tailored to suit their needs, and the results of which can be quickly implemented and transferred. The objective of the INNO-KOM Ost program is to strengthen Eastern Germany’s innovative power through support activities designed to promote the innovative performance capability of the region’s non-profit industrial research institutions.


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