German exports down surprisingly

German exports down surprisingly

Compared with the previous month, exports in july fell by 1.1 percent on a seasonally adjusted basis, as reported by the federal statistical office in wiesbaden on friday. Economists had expected a plus of 0.7 percent. Imports rose by 0.5 percent.

Year-on-year stagnation in german exports. At minus 1.0 percent, shipments to so-called third countries were particularly weak, and exports to the euro zone also fell by 0.7 percent. Only trade with EU countries that do not belong to the european union developed positively: exports to these countries in july were 3.6 percent above the level of the previous year. Overall imports increased by 0.9 percent year-on-year.

"Nothing new in the eagle trade. There is a lack of momentum, so exports remain at a high level," said anton borner, president of the BGA, the german association of auctions and trades, on friday. The continuing uncertainty on the world markets is hampering decisions and thus the economy: "for example, the current crisis in syria and its impact on the price of oil are contributing to the global uncertainty."From january to july, german exports fell short of the previous year’s figure by 0.5 percent.

Despite the surprisingly weak july result, exporters needn’t put the year behind them yet. "Exports should pick up gradually in the second half of the year as the eurozone emerges from recession," said moody’s economist anna zabrodzka. However, sluggish exports to china, the third most important sales market, put the brakes on the upswing for german exporters.

According to preliminary calculations by the deutsche bundesbank, the current account balance, which includes all trade in goods and services with foreign countries as well as earned income and investment income, closed with a surplus of 14.3 billion euros in july. From january to july, the current account surplus rose to 105.3 billion euros, up from 101.6 billion euros a year earlier.

According to estimates by the ifo institute, germany will end 2013 with a record current account surplus. With the recovery of the world economy, the plus should approach the 200-billion-euro mark, the experts emphasized.

Already in 2011 and 2012 germany had achieved the highest current account surplus in the world and was thus the world’s largest capital exporter. With 238 billion U.S. Dollars (about 186 billion euros), the german value was still ahead of china with a surplus of 193 billion U.S. Dollars. Goods trade was almost exclusively responsible for the german surplus.

Critics repeatedly accuse germany of living off its export surpluses at the expense of others and thus throwing the world economy out of balance. Because the german surplus is matched by a deficit elsewhere: these countries have to finance their imports through debt.

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