Nov. 10 (Bloomberg) -- In the 44 years that Carl Zeiss AG was forced to operate as two companies, separated by a Cold War dividing East and West Germany, the stock market in Europe’s biggest economy was about as exciting as sausage and sauerkraut.

Today, 20 years after the Berlin Wall collapsed, Carl Zeiss, which made the lenses used in movie cameras that shot “Slumdog Millionaire” in India and a one-of-a-kind projector in the Hayden Planetarium in New York, is adding to an export boom that has enabled Germany’s so-called DAX Index to appreciate twice as much as the benchmark for worldwide equities.

The 163-year-old lens and microscope maker, which split in 1946 as communists tightened their hold on East Germany, got 84 percent of its 2.7 billion euros ($4 billion) in annual revenue last year from exports. The 1989 figure was less than 50 percent for both the eastern and western companies.

“The reunification of the two Zeiss companies has been a great gift, despite all the difficulties,” Carl Zeiss AG Chief Executive Officer Dieter Kurz said yesterday. “It was a great help that both companies in east and west had the same corporate culture, which has always focused on a drive for innovation.”

The DAX has advanced 268 percent during the past two decades, while the MSCI World Index climbed 109 percent, according to monthly data compiled by Bloomberg. The DAX rose 137 percent from the end of 1969 until October 1989, lagging behind the 430 percent increase of the MSCI World Index.

Biggest Exporter

The end of communism let German companies such as Carl Zeiss, Siemens AG and Volkswagen AG gain entry in eastern Europe and China, turning the country into the world’s biggest exporter. The country sells 9.3 percent of all global exports, exceeding China’s 9.1 percent and 8.2 percent from the U.S., according to data compiled by the World Trade Organization.

German exports have risen fourfold since reunification, to $1.46 trillion last year from $341 billion in 1989, according to WTO data. Germany surpassed the U.S. in exports in 2003 and has maintained that lead every year since.

Germany has absorbed the six states that once comprised communist East Germany and made almost 2 trillion euros of public and private investments to reduce the gap between east and west.

“After 20 years for me it’s a huge success,” said Horst Teltschik, a senior adviser to former Chancellor Helmut Kohl, who presided over reunification. “The system was bankrupt. Nowadays you have an infrastructure in eastern Germany that is mostly better than in West Germany, whether it is railroads, highways, telecommunications systems and so on.”

Richer by Comparison

Gross domestic product per capita in eastern Germany, home to 17 million people in 1989, was 71 percent of the level in western Germany last year, according to government statistics published in June in an annual report on the state of German unity. It was 42.8 percent in 1991.

More easterners now own cars than westerners, Klaus Schroeder, a political science professor at Berlin’s Free University, said in a study published Oct. 28. Men and women live an average of about six years longer than before and the state of the environment in the east has been transformed, he concluded.

The increase in prosperity is “without precedent,” according to Schroeder, who calculated the 2 trillion euros of so-called west-to-east transfers.

Fifteen of the companies in the DAX two decades ago are still part of the index. Siemens, Europe’s biggest engineering company, carries the most weight in the DAX, whose return during the past two decades includes reinvested dividends. The market value of Munich-based Siemens, which has sites in eastern cities including Leipzig, has almost quintupled since Nov. 9, 1989.

Skoda Cars

Volkswagen held discussions about a venture in eastern Germany on Nov. 16, one week after the wall fell, said Carl Hahn, 83, then the company’s chief executive officer. Six months later, Volkswagen started assembling Polo subcompact cars in east Germany and in September 1990 laid the foundation for a new engine factory in Mosel, in Saxony. The company agreed to buy Czechoslovakian automaker Skoda Auto AS in March 1991.

“Without the collapse of communism, this wouldn’t have been possible,” Hahn said in an interview yesterday. “It has helped us grow a lot more and reach a much bigger degree of stability. That’s been our strategy.”

Volkswagen’s Audi luxury car unit makes its TT sports car in Hungary. Bonn-based Deutsche Telekom AG, Germany’s national phone company, acquired counterparts in Hungary, Croatia and Slovakia.

Carl Zeiss now has 20 production sites, in Germany, France, Hungary, the U.S., China and Belarus. The company was founded in 1846 in Jena and is based in Oberkochen in the West. A medical unit began publicly trading in 2003.

One in Three

Exports account for one in three jobs in Germany, according to the BGA exporters’ association. German exports may rise almost 6 percent next year, compared with 4.4 percent for the euro region as a whole, analysts at Frankfurt-based Deutsche Bank AG forecast. French exports will rise 3.8 percent and Spanish foreign sales will increase 2.4 percent, Deutsche Bank estimates.

“Germany’s strength lies largely in the fact that the Federal Republic is a center of industry and that it’s an export nation,” German Chancellor Angela Merkel, who grew up in the East, told a meeting of the IG BCE mining, chemical and energy union in Hanover on Oct. 14.

The east also has become a center for Germany’s solar industry. Solar companies expect to create 15,000 jobs in the east over the next four years and 15 production sites are under construction, according to the BSW solar-industry association.

Still Leaving

Eastern Germany hasn’t entirely caught up. About 2 million people from the former German Democratic Republic left the region to seek new jobs during the past two decades. The unemployment rate in the East stood at 12.7 percent in October, compared with almost 7 percent in the nine western states.

“The Wall in the mind is still there,” said Carsten Brzeski, a Berlin-born economist at ING Groep NV in Brussels. “It’s slowing down change.”

Political divisions also remain. The anti-capitalist Left Party, which includes former East German communists, garnered 12 percent of the national vote in the Sept. 27 elections won by Merkel’s Christian Democrats. In the east, the party had 2 1/2 times that amount, placing second behind Merkel’s party by a one percentage point.

Marianne Birthler, who was living in East Berlin the night the wall fell, saw her appearance at last night’s gala celebration as a moment to reflect on the first time she stepped into the west.

“For a whole second I thought, ‘hopefully they’ll let me back in, my children are at home sleeping in bed,’” said Birthler, 61, a former church worker who now heads the government commission in charge of the Stasi secret police records. “Whoever was in that stream of human beings knew that things couldn’t return to the way they were.”

To contact the reporters on this story: Alan Crawford in Berlin at acrawford6@bloomberg.net; Hellmuth Tromm in Berlin at htromm@bloomberg.net.

Last Updated: November 10, 2009 02:31 EST