German exports took a hit in November 2022. According to the Federal Statistical Office in Wiesbaden, exports fell by 0.3 percent compared to the previous month after calendar and seasonal adjustment.
“A sharp cooling of the economy, especially in the important sales markets of the EU and China, to which around 60 percent of all German export goods go, is causing export sales to melt in line with the mild winter,” explained Volker Treier, head of foreign trade at the Association of German Chambers of Industry and Commerce. According to the most recent data, exports increased by 0.8 percent in October.
Exports to the USA and China in particular were down in November compared to the previous month, and trade with member states of the European Union (EU) also weakened. The value of imports decreased overall by 3.3 percent from the previous month.
The President of the Federal Association of Wholesale, Foreign Trade and Services, Dirk Jandura, called for a strategy for the future “how Germany wants to assert itself as an attractive trading partner in an increasingly polarizing world.” He is concerned about developments in China. Beijing abruptly announced an end to its zero-Covid policy on December 7th. Since then, the country has experienced a massive corona wave. Jandura fears that the supply chains are at risk of being burdened again.
Significant increase compared to November 2021 – inflation “helps”
The picture is significantly better in a year-on-year comparison. According to preliminary data from the Wiesbaden authorities, goods worth 135.1 billion euros were exported from Germany in November. That was 13.3 percent more than a year earlier. Imports rose within a year by 14.7 percent to 124.4 billion euros.
In the first eleven months, the value of exported goods, at EUR 1,435.3 billion, already exceeded the result for the whole of 2021 of around EUR 1,368 billion, according to the latest data. However, the significant price increases of the past few months, which are driving up the value of exports and imports, are also reflected in the year-on-year growth. The consequences cannot be precisely quantified. No price-adjusted data is collected.
Thomas Gitzel, Chief Economist at VP Bank, assumes that German exports should benefit in the coming months from better functioning supply chains. “The better supply of raw materials and preliminary products could get industrial production and exports moving, precisely because of the high order backlog.”
According to a survey by the Ifo Institute, the German export industry was recently cautiously optimistic again. The export expectations of the companies surveyed rose to plus 1.6 points in December, from plus 0.9 points in November. The automotive industry continues to expect significant growth. The electrical industry also sees more opportunities in foreign business, explained Ifo President Clemens Fuest. On the other hand, the chemical industry and the metal sector assume that export sales will decline.
