Foreign trade
Weak global economy: slowdown in exports from Germany
Containers in the Ulm transshipment station. photo
© Stefan Puchner/dpa
The demand for products “Made in Germany” has continued to decline. German foreign trade is also feeling the effects of the weakness of the global economy.
The slump in German exports continued in October. According to the Federal Statistical Office, the value of goods exports fell both compared to the previous month (minus 0.2 percent) and compared to the same month last year (minus 8.1 percent). “Geopolitical risks, coupled with the unfortunately still weak situation, are also weighing on October “The global economy is driving demand for products “Made in Germany,” explained Volker Treier, head of foreign trade at the German Chamber of Commerce and Industry. In total, goods worth 126.4 billion euros were delivered abroad.
The economic slowdown in the EU is particularly hitting the German export industry hard, said Treier. “The enormous burden of bureaucracy and costs in this country further weakens the position of German foreign trade in international competition.”
According to the assessment of the foreign trade association BGA, the impetus for a necessary strong revival of business is lacking at home and abroad. “The stubborn inflation resulting in a tight monetary policy by the major central banks and the Ukraine war with all its political and economic consequences are severely dampening burdens,” said Dirk Jandura, President of the Federal Association of Wholesale, Foreign Trade and Services (BGA).
According to statisticians, exports to the member states of the European Union (EU) – the most important sales region for goods from Germany – fell in October by 2.7 percent to 67.9 billion euros compared to the previous month. However, there was an increase in exports to the USA and China.
“But more is needed for a sustainable trend change in the export economy,” said Thomas Gitzel, chief economist at the Lichtenstein-based VP Bank. To achieve this, foreign orders would have to increase more strongly and across the board. “As long as the global economy is not on the path to recovery, this will not be the case.”
Weak global economic growth expected
The International Monetary Fund (IMF) recently expected the global economy to grow by 3.0 percent this year and next year. It would therefore be well below the annual average of 3.8 percent from 2000 to shortly before the pandemic.
Exports are no longer supporting the German economy for the time being. The balance for the first ten months was also negative. The value of exported goods fell by 0.8 percent to 1,304.6 billion euros compared to the same period last year.
There were also clear signs of braking during import. The value of imported goods fell by 1.2 percent in October compared to the previous month and by 16.3 percent within a year to 108.6 billion euros.
Last year, German foreign trade achieved record results, partly due to significant price increases. However, the effects cannot be quantified precisely because statisticians do not collect price-adjusted data on foreign trade.