“Historical drop in exports, Germany officially downgraded”, titre The world to report on foreign trade figures for May, the worst for the country since reunification. “For the first time since 1991, the German trade balance is negative”, and the fault lies with “China and Russia”, ses “two major export partners”.
The surpluses, which make the economic power of the country, “German citizens can no longer count on it”, the conservative newspaper is alarmed. In May, Germany imported more than exported, and the difference is around one billion euros (900 million euros).
A warning
The last time this balance was in the red was in 1991, during reunification, when “the immense unquenched thirst for consumption could only be satisfied by imports”. This time, “this is not a consumption boom, quite the contrary”. Whereas “consumer morale just plummeted to an all-time low,” this deficit “is therefore not a sign of a national economic strength, but rather a warning about the economic state of the country”.
Germany depends on energy imports, “whose price keeps increasing”. Trade with Russia has “collapsed” since the invasion of Ukraine, but it is with China that Germany recorded the largest deficit in May, at 8 billion euros. Supply chain issues and restrictions due to the pandemic also weigh in the balance.
Heino Ruland, an analyst at Ruland Research, explains:
“Germany’s trade surplus is shrinking month by month as the balance of power in world markets changes.”
Since the year 2000, the Federal Republic “registered surpluses of around 10 billion euros per month on average”. Even at the start of the pandemic, “the German trade balance has never slipped into the red”. In 2021, “the foreign trade surpluses would still have contributed more than 5% to German economic growth”, emphasizes the Berlin daily.
Without this “stimulation”, what will become of the German economy? For Heino Ruland, “Germany is already in recession”. Le “downgrade” of the country is visible on the financial markets, notes the daily: of the first 100 groups listed on the Stock Exchange, “there is only one German company left, the chemist Linde”, ranked 74e with a valuation of 143 billion dollars (137 billion euros).