msterdam. Dubai. Memphis. Mention these locations, and virtually everyone will recognize them as some of the top logistics locations in the world.
   If recent history is any indication, the German state of Saxony-Anhalt may soon be added to that list.
   When Red Parcel Post announced July 3 that it would build the first of four planned logistics centers in Stegelitz near the Saxony- Anhalt capital of Magdeburg, it capped a series of sizable investments for the former East German region that's now bustling with multi- modal transport capabilities.
   RPP intends to invest €130 million (US$178 million) and create 260 jobs with the project, which will provide 700 to 800 vehicles to move parcels in and out of the complex. The center will serve as the corporate headquarters of RPP.
   "Saxony- Anhalt is increasingly proving to be an attractive logistics location," said Dr. Reiner Haseloff, economic minister for Saxony- Anhalt. "That applies not only for the greater Halle-Leipzig area, but for the Magdeburg area, which is an important intersection for street, rail and waterway, because it connects West and East.
   "We are especially pleased that this large investment will further strengthen the Magdeburg region with many new jobs," he added. "The fact that the company will have its headquarters location in Saxony- Anhalt is an additional important step for strengthening our profile as the logistics location in the heart of Europe."
   The RPP facility, near the A2 highway, is slated to open in the first half of 2008. The sole investing shareholder is entrepreneur Walter Hellmich, chairman of the Hellmich group of companies.
   Hellmich is not the only investor banking on the growth of logistics in Saxony- Anhalt. On May 5, Dirk Rossman GmbH opened its expanded central warehouse in Landsberg, part of a €50- million (US$68- million) investment that adds 155 jobs. The largest development in the company's history brings employment at Landsberg to 430.
   "Rossman operates a foresighted company policy with this location expansion," said Prime Minister Prof. Wolfgang Böhmer, who attended the opening. "Saxony- Anhalt intends to profit from the DHL commitment at the Leipzig/Halle Airport. The state is well prepared and can react quickly to investor inquiries."
   While much more media attention has been focused on Belgium and the Netherlands as logistics hubs for Europe, a quiet renaissance has occurred in and around Magdeburg and Halle, the two principal cities of Saxony- Anhalt. Fueled largely by the expansion of the Leipzig/Halle International Airport – the new cargo hub for DHL – the German state has been landing huge logistics investments from a bevy of companies.
   Netto, Otto, Aldi, Edeka, Kaufland, Schlecker, Lidl, and Wolter Koops are just a few of the firms that recently made large capital investments in the region.
   "Logistics and transportation companies value the favorable location factors of the state, particularly the centralized position in Europe and the efficient transportation infrastructure," said Haseloff. "These location factors are a significant prerequisite for economic growth and employment in the state. Strategic management decisions are determined more than ever by the quality of the transportation infrastructure, in particular by the efficiency of the streets, railways, waterways and, not lastly, by the good accessibility by air."    Among other benefits, Saxony- Anhalt offers companies 600 km. (373 miles) of navigable waterways and the modern Port of Magdeburg connecting vessels to the North and Baltic Seas. Additional ports and transfer points are located along the state's waterways, with tri- modal facilities at the ports of Magdeburg, Rosslau, Aken, Haldensleben and Halle- Trotha.
   Five major highways serve Saxony-Anhalt: the A2 connects Dortmund, Magdeburg and Berlin; the A9 connects Munich, Halle and Berlin; and the A14 connects Dresden, Magdeburg and Shwerin. The motorways A38 and B6n cross the state in East/West and Southeast/Northeast directions.
   Saxony- Anhalt provides some 2,300 kilometers (1,428 miles) of railroads and 400 train stations – one of the densest rail networks in Europe.
   But the crown jewel of transportation is the airport at Leipzig/Halle. With unrestricted air access around the clock for air freight traffic, less than 1,000 kilometers (621 miles) from London, Paris and Copenhagen, only 630 kilometers (391 miles) from Brussels, and just 515 kilometers (320 miles) from Amsterdam.
   Air cargo volume last year reached 29,330 metric tons (32,322 tons). Passenger volume topped 2.35 million. The airport features a 3,600-m. (11,815-ft.) parallel runway system. Saxony- Anhalt offers plenty of ready- to- build industrial sites close to the airport.
   Logistical advantages, however, are not the only selling points for Saxony- Anhalt, officials say. They point to labor costs that are 30 percent lower than those found in western Germany. In fact, the labor costs per man- hour in the East German states are lower than those found in the U.S., Ireland, the U.K., France, Austria, Switzerland and Belgium. With this cost advantage, Saxony- Anhalt combines the advantages of Eastern Europe with the advantages of Western Europe. As part of Germany, Saxony- Anhalt has the same legal and political stability.
   As the European Union continues to extend eastward, officials in Saxony-Anhalt say the state is poised to take advantage of Europe's expanding economy.
   Companies like Dell, Bayer, Novelis, Total, and Guardian have made major capital investments in Saxony-Anhalt, and those are likely to continue.
   With 2.6 million people, Saxony- Anhalt still offers the lowest labor rates in all of Germany while producing highly skilled technical workers, thanks to the presence of seven major universities.
   The Otto- von- Guericke- Universitat Magdeburgoffers a course of study unique in Germany: a program called "industrial engineering logistics." The university cooperates closely with the Fraunhofer Institute for Factory Planning and Automation. A Virtual Development and Training Center (VDTC) is offered by the institute as well.    The state's gross domestic product increased by 2.8 percent in 2006, rising from €48.1 billion (US$65.9 billion) in 2005 to €50 billion (US$68 billion). This made Saxony- Anhalt the fastest growing state economy in Germany two years running.
   Foreign direct investment contributes to this economic growth. Of all the FDI flowing into eastern Germany, 41 percent goes to Saxony- Anhalt. Much of this capital goes into manufacturing investments. Factory output in Saxony-Anhalt climbed 8.12 percent in 2005 and 12.2 percent in 2006. Investments in buildings and machinery in 2004 (the most recent year measured) totaled €1.6 billion (US$2.2 billion).
   The state ranks as Germany's 10th- leading exporter out of 16 states. In 2005, Saxony- Anhalt exported goods to the U.S. valued at €297.55 million (US$407.42 million). The largest categories of exported goods include glass, iron and steel pipes, and semi-finished chemical products.
   Some 50 U.S. companies have invested in Saxony- Anhalt since German reunification in 1990, creating more than 6,000 jobs. The largest single investor is Dow Chemical, with sites in Schkopau, Bohlen, Leuna and Bitterfeld.
   Other top- performing industries in Saxony- Anhalt include paper, publishing and printing, food processing and metals. In each case, these industries in Saxony- Anhalt outperform their counterparts in western Germany.
   Saxony- Anhalt makes available incentives to companies doing expansions in the state.The public grants and subsidies include R&D grants, work- force cost subsidies, investment grants and loans. Saxony- Anhalt is an EU-subsidy region. Nowhere in the EU are there higher grants for investors. A typical industrial company making an investment of €30 million (US$41 million) in Saxony- Anhalt, for example, could qualify for up to €12 million (US$16.4 million) in incentives.