A record that does not make anyone happy: German exports reached a new record last year. In December, however, there was hardly any increase. And domestic industrial production is weakening.

In order to understand the only cautious joy about the export record of the German economy last year, one should look at the figures on industry and production: German companies reduced their production in December as much as it has since the beginning of 2009 – the year in which Germany also suffered from the consequences of the great global economic crisis.

skid marks

Industry, construction and energy suppliers together produced 3.5 percent less in December 2019 than in the previous month. Economists had only expected a minus of 0.2 percent. The Federal Ministry of Economics presented the balance on Friday. Meanwhile, the Federal Statistical Office provided the exact export figures: In total, goods worth almost 1.328 trillion euros went from Germany to the world last year, and goods worth 1.104 trillion euros were imported from abroad. This means an increase in exports of 0.8 percent compared to 2018; imports grew by 1.4 percent. 

Germany ThyssenKrupp Stahlfabrik Duisburg (Reuters / L. Kügeler)Companies reduce production – steel furnace in Duisburg

At the end of the year, however, the signs of braking increased. Calendar and seasonally adjusted, exports rose just 0.1 percent compared to November 2019. In November, exports fell significantly by 2.9 percent compared to the same month in the previous year.

The year-on-year increase is also rather modest compared to previous years: So if there were 0.8 percent more exports in the past year, there was a plus of 3 percent and 6.2 percent in 2018 and 2017, respectively.

“New sand in the transmission”

And economists see little improvement in the immediate future either: “As incoming orders from abroad are also pointing downwards, it should come as no surprise that exports do not increase significantly,” said Thomas Gitzel from VP Bank. “Not even the weak euro can provide protection. The supply chains interrupted as a result of the corona virus will become a further burden for German exports in the coming months.”

His colleague Alexander Krüger, economist at Bankhaus Lampe, is also skeptical: “The global trade dispute has been settled for the time being, but the Corona virus is scattering new sand in the export gear. The coming months will probably show a sideways movement in pinball mode.” After all, the Munich Ifo Institute sees a thin silver lining “on the dark horizon of German industry”: According to Ifo, companies expect their production to increase slightly again in the next three months.


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