German exports 2022: record result for German goods

Berlin Many admonishers and warners had already called for the end of globalization in the past few months. First of all, the corona crisis and especially the war in Ukraine would show that the network of international trade had reached its limits.

However, the figures published by the Federal Statistical Office on Thursday speak a completely different language – at least at first glance. Germany’s exporters achieved record results in 2022 as a whole. With 1564 billion euros, never before was such a high value of goods delivered abroad as in the past year. The previous record from 2021 was exceeded by 14 percent.

The curve is also pointing steeply upwards for imports. The German economy imported goods worth 1,488 billion euros in 2022, an increase of 24 percent on the previous year. “The death of globalization that is so often proclaimed at this time is simply not happening,” says Gabriel Felbermayr, President of the Austrian Institute for Economic Research (WIFO).

But how do these numbers fit in with the fact that the Russian attack on Ukraine triggered global uncertainty and affected supply chains and that the after-effects of the corona pandemic were still being felt at the beginning of 2022?

What is important about the figures from the statistical office is that they are influenced by changing prices for exports and imports – especially when prices change enormously, as they did in 2022.

Bad development in foreign trade in December

Prices have risen in almost all areas over the past year, but especially those for energy. Because Germany has to cover a large part of its energy requirements from abroad, the import figures in particular are distorted.

>> Read here: How much prosperity the crisis is costing Germany

But the export value would also have been significantly lower without the price rally in 2022. The Federal Statistical Office does not publish price-adjusted figures. The Federation of German Industries (BDI) estimates that German exports were two percentage points weaker than global trade last year. “The export balance for the year is not as good as it seems,” said BDI General Manager Tanja Gönner.

The second snag in the figures is that foreign trade has recently developed anything but well. In December, exports fell by 6.3 percent compared to the previous month, and imports fell by 6.1 percent. Economic analyst Oliver Rakau from Oxford Economics explains: “In real terms, the trade balance fell close to the lows of last year.”

Economists on the slump in exports

Looking at the other EU countries, exports fell by four percent and imports by 4.8 percent compared to the previous month. The overall decline was primarily based on restricted trade with the USA. Ten percent fewer goods were exported there than in November.

>> Read here: How much EU industrial policy does it need? Two economists in a dispute

Exports to the United States thus fell to a value of 12.3 billion euros. However, this could improve again in the near future, the economic development in the USA has recently shown itself to be more robust than expected.

Ultimately, concerns about a sharp slump in world trade and a German business model that will be put under even more pressure seem unfounded at first. “Even when adjusted for price, the numbers are really strong,” says economist Felbermayr.

Gabriel Felbermayr

The economist sees no end to globalization.

(Photo: AFP/Getty Images)

Above all, the biggest obstacles to trade, the global supply bottlenecks, are slowly but steadily disappearing. In January, in an Ifo survey, 48.4 percent of the companies surveyed reported material shortages. In December it was still 50.7 percent.

Nevertheless, German foreign trade is not close to a boom. The federal government expects a difficult year for German exporters. The “subdued development of the global economy” is initially dampening the prospects of German exporters on the international sales markets.

Exports are only likely to grow by 2.2 percent in 2023, according to the government’s latest economic forecast. However, this is still a long way from deglobalization.

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