The United States surpassed China in the first quarter to become Germany’s largest trading partner. This is according to Reuters calculations based on data from the Federal Statistical Office. The value of Germany’s trade with the US, i.e. exports and imports combined, from January to March was 63 billion euros, while the value of trade with China was less than 60 billion euros.
Partnership
Last year, China became Germany’s most important trading partner for the eighth consecutive year. The total volume of trade amounted to 253 billion euros. However, the United States was only a few hundred million euros behind.
“German exports to the US have now continued to grow thanks to the strong economy there, while exports to and imports from China have declined,” said Commerzbank economist Vincent Stamer. Structural reasons are also a factor, he said. “China has moved up the value chain ladder and is increasingly producing more complex goods itself that it used to import from Germany,” Stamer added. In addition, German companies are also increasingly manufacturing locally instead of exporting goods from Germany to China.
Limited connectivity
Germany has said it wants to reduce its links to China. It cites political differences and accused Beijing of “unfair practices” in its first China strategy announcement last year. However, Berlin has been vague about political steps to reduce dependence.
German imports of goods from China fell by almost 12 percent year-on-year in the first quarter. Exports of goods to China fell by more than one percent, said Jürgen Matthes, an economist at the German IW Institute. The US now accounts for around ten per cent of German exports, he said, while China’s share has fallen to less than six per cent. He said the change is probably due to the fact that the Chinese economy is doing worse than many had hoped, while the US economy is beating expectations.
However, it is uncertain whether this trend will continue. “If the White House administration changes after the US election in November and moves more towards closing markets, this process could stall,” said Dirk Jandura, president of the BGA trade association.
Source: Czech Press Office
