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Germany poised to overtake US as world’s No.2 exporter this year
Germany could overtake the United States to become the world’s second-biggest exporter this year, but its share of global trade is likely to dip as its exports lag global expansion, German chambers of commerce said on Thursday.
Europe’s biggest economy, currently the world’s third-biggest exporter after China and the United States, has seen its share of world trade fall to 7.5 percent by last year, from a post-German unification peak of 11 percent in 1991-92, according to DIHK Chambers of Commerce.
DIHK sees Germany’s share slipping to 7 percent this year and in 2014.
The German economy is rebounding after a slow patch. Data on Wednesday showed it grew 0.7 percent in the second quarter, its fastest quarterly expansion in more than a year and helping pull the euro zone out of an 18-month recession.
The second-quarter expansion, however, was mainly driven by domestic private and public consumption.
DIHK forecast that German export growth would slow this year to 2 percent, from 3.4 percent in 2012, lagging a projected 3.8 percent rise in global trade.
Germany’s exports would rise 4 percent next year, but that would be less than an expected 6 percent increase in world trade, DIHK forecast.
“Therefore Germany will lose some of its share of world trade,” DIHK said in a report on the global economy.
German exports, from BMW cars to washing machines to heavy machinery for manufacturing and agriculture, totalled 1.1 trillion euros last year.
DIHK forecast that economic growth would lead to a strengthening of the euro currency in the near term. While that would start to pose risks for German exporters, it would boost the value of Germany’s exports in dollar terms, pushing it above the United States in the ranking of world exporters, which is calculated in dollars, DIHK said.
“Germany has the right stuff this year to overtake the United States into second place. That’s due to the strong euro because trade data is calculated in dollars. Germany should also be able to hold onto second place in 2014 as well,” DIHK foreign trade head Volker Treier said.
DIHK forecasts the euro’s average exchange rate against the dollar will be 1.33 in 2013, strengthening from 1.29 in 2012, and rise to between 1.35 and 1.40 in 2014.
The euro is currently trading at just under 1.33.
“It’s more than just a silver lining on the horizon,” Treier said, referring to the stabilisation in the euro zone. While there could still be temporary setbacks he does not see an escalation of the euro zone crisis.
France and the United States are Germany’s two biggest export markets. China is its fifth-biggest market but DIHK said it could slip down the rankings this year.
Germany is also the world’s No. 3 importer after the United States and China, according to the latest World Trade Organisation data. (Reuters)
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