Germany’s export machine got back into gear in May, expanding by 4.3 per cent and partially offsetting a slump of 5.6 per cent in April, data from the national statistics office showed yesterday.
The provisional gain in May left Germany, Europe’s biggest economy and the world’s second biggest exporting nation after China, with a seasonally-adjusted trade surplus of €12.8 billion, the Destatis office said.
That stood in contrast to neighbouring France, which posted a record trade deficit of €7.42 billion in May, prompting junior trade minister Pierre Lelouche to warn of a “very serious” lurch towards a less competitive economy.
Analysts have warned repeatedly about falling competitiveness in France, which they link to a relatively weak network of medium-sized companies compared with Germany.
Germany and France are the two mainstays, economically and politically, of the eurozone, and France is increasingly asking itself questions about how Germany does so well, and how to keep up.
However, German exports draw on imports from other European Union countries.
Although some in the eurozone claim Germany has grown at the expense of its neighbours, the Destatis data showed differently, as imports rose by 3.7 per cent in May to erase a drop of 2.5 in April.
“With the consumption climate improving on the back of falling unemployment and rising income, domestic demand and imports should expand stronger than exports, helping other European countries to rebalance their external sectors,” Berenberg Bank senior economist Christian Schulz said.
Barclays Capital counterpart Frank Engels noted that so far this year, 60 per cent of German exports have gone to other European Union countries, while more than 63 per cent of imports have been bought from them.
He pointed out that the non-adjusted value of exports had reached the second highest level this year at €92.1 billion, while imports were at a year-to-date high of €77.3 billion.
Mr Engels said that “implies that Germany’s trade has so far defied the deceleration in trade seen elsewhere on the globe, particularly in Asia.”
On a 12-month comparison, German exports showed an increase of 19.9 per cent in May, while imports were 15.6 per cent higher, Destatis said.
Figures provided by the German central bank put the current account of the balance of payments, a broad measure of trade and financial transfers with other countries, at a surplus of €6.9 billion in May.
That was more than double the year-earlier figure of €3.1 billion.
The numbers suggest smooth functioning of the German exp-ort mechanism, which has accounted for much of the country’s growth but which might begin to face headwinds owing to a global slowdown.
On Thursday, the Economy Ministry said German industrial output rebounded in May, gaining a monthly 1.2 per cent following a decline of 0.8 per cent in April.
Industrial orders rose by 1.8 per cent meanwhile, far exceeding analysts’ expectations and pointing to sustained support for manufacturers. The economy is officially expected to expand by 2.6 percent this year after growing by 3.6 per cent in 2010, but Chancellor Angela Merkel has suggested that forecast could be raised above three per cent in the coming months. Domestic consumption is showing signs of life, as unemployment falls further below the politically sensitive three-million mark.