In Eastern Germany, Tide Has Yet to Turn

An air hangar was converted into a Polynesian-style paradise to create Tropical Islands south of Berlin.
An air hangar was converted into a Polynesian-style paradise to create Tropical Islands south of Berlin.
By Craig Whitlock
Washington Post Foreign Service
Thursday, September 1, 2005

KRAUSNICK, Germany -- Inside the world's biggest terrarium, a sparse crowd of pale European tourists clad in skimpy bathing suits laze on a fake beach, sipping fruity drinks under towering palm trees and occasionally taking a dip in the shallow swimming pool. About 300 feet up, a translucent roof lets sunbeams filter through, lighting a cavernous arena so big it could swallow six MCI Centers.

When it opened in December outside this village about 50 miles south of Berlin, the Tropical Islands resort was billed as a potential economic powerhouse for the Spreewald, a thickly forested but economically depressed region in eastern Germany.

In a country known for its long winters and bleak skies, private investors and the German government hoped Tropical Islands could attract 3 million visitors annually to a former air hangar converted into a climate-controlled Polynesian-style paradise. The project also promised to bring at least 600 new jobs to this area, which is still waiting for the prosperity and equality it was promised after the fall of the Berlin Wall and the Iron Curtain 16 years ago.

Eight months after its opening, however, Tropical Islands is struggling to stay afloat, and many people fear it will join a long list of well-intentioned but ill-advised boondoggles that have hampered Germany's $1.5 trillion effort to erase the economic divide between the formerly communist East and the much wealthier West. The cost has mushroomed far beyond what most Germans expected.

The troubles at Tropical Islands and the persistent difficulties in merging east and west have contributed to a sour mood among German voters, who go to the polls Sept. 18 to elect a new national government. Public opinion polls show that Chancellor Gerhard Schroeder's coalition of Social Democrats and Greens is at serious risk of losing to the Christian Democrats, whose leader, Angela Merkel, is bidding to become Germany's first female chancellor.

In the town of Frankfurt an der Oder, along the Polish border, a $1.6 billion government-subsidized plan to build a semiconductor factory fell into bankruptcy before it could produce one chip. In Klettwitz, to the south, the government spent about $150 million to construct the EuroSpeedway Lausitz, an auto-racing palace that has generated only about 50 jobs and failed to attract the Formula One races it hoped for.

In Krausnick, the original plan for the sprawling hangar, built on the site of a former Soviet military airfield, was to make it the world's largest blimp factory. In the late 1990s, the government agreed to subsidize a private $800 million venture to churn out cargo-carrying dirigibles, despite warnings that the market for them had been almost nonexistent since the Hindenburg went down in flames six decades earlier. Investors declared bankruptcy in 2002.

The unemployment rate in Germany hit 11.6 percent this year, the highest since the aftermath of the country's defeat in World War II. Job prospects are even worse in the former East Germany, where about one in five people are out of work. Social tensions have festered, with many people angry about how much the government has spent on unification and many easterners resentful that they are frequently still perceived as backward freeloaders.

The conflict erupted on the campaign trail Aug. 10 when Edmund Stoiber, the state minister in Bavaria and the Christian Democrats' candidate for chancellor in 2002, complained that "frustrated East Germans should not be able to decide Germany's future." Adding fuel to the fire, he suggested that voters in eastern Germany were ignorant, saying: "Unfortunately, we don't have such intelligent voters everywhere as we do in Bavaria."

Stoiber later backed away from his comments, but the episode did little to help Merkel, who has modest popularity ratings in the east even though she grew up in the eastern state of Brandenburg.

With Germany saddled with a large budget deficit and high unemployment, opinion surveys show voters are widely skeptical of lawmakers' ability to repair the country's internal divisions. A poll of 1,500 people in eastern Germany conducted for Der Spiegel magazine last month found that 44 percent said they had no faith in any political party to solve economic problems in that part of the country.

The same poll found that the most popular political party in the region, by a narrow margin, was the newly formed Left Party, a coalition of former East German communists and disaffected Social Democrats who have fallen out with Schroeder over his government's plan to cut welfare programs and other benefits. About 29 percent of those surveyed said they favored the Left, with the Social Democrats and Christian Democrats each pulling about 28 percent.

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