Jena, Germany - The historic city of Jena - best known for producing Carl Zeiss optical instruments in the early 20th century - is enjoying a revival after the upheavals of German unification.

Most of the east German city's plants and research institutes were decimated during World War II, and few believed Jena could ever recover, but it did - until the Berlin Wall fell in 1989.

The east's era of swollen employment came to an abrupt end when the economic shock of reunification impacted on its labour market shortly afterwards.

Vast numbers of workers in Jena and in neighbouring Leipzig, Dresden, and Chemnitz were axed as traditional communist markets in eastern Europe crumbled, and companies went bust.

There were fears Jena would suffer the fate of other eastern industrial centres where firms were snapped up by western competitors at low cost, then downsized or even shut down.

Not until Lothar Spaeth, a canny former premier of the western state of Baden-Wuerttemberg, arrived in Jena did an economic turn- around take place.

Jenoptik became the successor firm of Carl Zeiss and Spaeth its chief executive. He allowed former Carl Zeiss employees to use the firm's facilities to create their own companies, spawning a flood of new start-ups in the 1990s.

The hillside Beutenberg Campus was created in 1998 along with a string of research institutes and two science centres, one of them for biotechnology. Enterprises like Zeiss, Jenoptik, Schott Jenauer Glas and Jenapharm helped consolidate the region's ailing economy.

The introduction of new technologies added to Jena's high-tech company attractiveness. Dr Michael Mertin, Jenoptik's chairman, talks of the city's "unique cooperation between economy and science."

Chatting with a group of journalists recently, he said the company had restructured its business into five divisions covering optics, lasers, defence systems, traffic solutions and industrial metrology.

With 130 apprentices and 600 of its 3,500 staff engaged in research and development, Jenoptik aims to be a 1-billion-euro group soon, he said.

In 2006, the company entered the traffic service market in North America, developing systems to monitor infrastructure, issue citations for traffic violations and collect fines.

"Now, with a presence in more than 60 countries, Jenoptik is easily the global market leader in photographic traffic monitoring," Mertin said.

Last year, the company achieved a turnover of 520 million euros (800 million dollars), some 60 per cent of which was derived from abroad.

Today, Jena is a melting pot of business enterprises and cultural activity - a place to carry out research, create patents and conduct business as well as to "write, play, compose and philosophize," say marketing experts.

Nicholas Milton, music director and chief conductor of the Jena Philharmonic, agrees the city has "great cultural ambience."

Orchestras in Germany and in other parts of the world often struggle to gain public attention, but in Jena "we regularly play to full houses," says Milton, from Sydney, Australia.

The dynamic young Australian arrived in Jena in 2004 after being the Adelaide Symphony Orchestra's concert master for six years. While most his orchestra members are from Germany, there are also musicians from Romania, Hungary, Canada, and the United States.

"We've concentrated a lot of effort on building up our public and it has paid off immensely," exudes Milton who spends part of each year working as a guest conductor abroad.

Astonishingly, in a town of 102,000 citizens, 25 per cent of Jena's population is today made up of students, most of them attending the renowned Friedrich Schiller University. (dpa)