In 1990 Dresden�an important industrial centre of the German Democratic Republic�had to struggle with the economic collapse of the Soviet Union and the other export markets in Eastern Europe. The German Democratic Republic had been the richest eastern bloc country but was faced with competition from the Federal Republic of Germany after reunification. After 1990 a completely new law and currency system was introduced in the wake of the collapse of the German Democratic Republic and eastern Germany's infrastructure was largely rebuilt with funds from the Federal Republic of Germany. Dresden as a major urban centre has developed much faster and more consistently than most other regions in the former German Democratic Republic, but the city still faces many social and economic problems stemming from the collapse of the former system, including high unemployment levels.
Until famous enterprises like Dresdner Bank left Dresden in the communist era to avoid nationalisation, Dresden was one of the most important German cities. The period of the GDR until 1990 was characterised by low economic growth in comparison to western German cities. The enterprises and production sites broke down almost completely as they entered the social market economy. Since then the economy of Dresden has been recovering.
The unemployment rate fluctuated between 13% and 15% within the first 20 years after Germany's unification and is still relatively high. Nevertheless, Dresden has developed faster than the average for Eastern Germany and has raised its GDP per capita to 31,100 euro, equal to the GDP per capita of some poor West German communities (the average of the 50 biggest cities is around 35,000 euro).
Thanks to the presence of public administration centers, a high density of semi-public research institutes which settle freely within Germany and a successful extension of high technology sectors through the help of public funding, the proportion of highly qualified
