German exports increased in the month of November, but not by the amount that was expected. This was due to an economic slowdown among some of its largest customers. EURACTIV Germany reports.
Exports by German companies grew strongly in November, up 7.7% on the same month in 2014, according to figures released by the Federal Statistical Office. The exported goods totalled some €102.2 billion, although in comparison with October, exports increased by just 0.4%.
The increase was lower than expected, due to a slowdown among major emerging countries, for example, China. Economists had predicted a 0.7% increase between October and November, after a decline of 1.3% had been registered in the month of October.
The €102.2 billion in purchased exports represented a 7.7% increase on November 2014. This was mainly ensured by continued strong demand from Europe. Exports to the eurozone were up 8.8% and up 10.8% to all member states. Business with the rest of the world only grew by 5.1%. The economic slowdown experienced by Brazil, China and Russia meant that those nations bought less “Made in Germany” products.
Production in the industrial and construction sectors grew by 0.3%, but a 0.5% increase had been predicted by analysts. German industry alone curbed its production by 0.8%, due to the decrease in demand.
Meanwhile, French industrial production slipped 0.9% in November compared to a month earlier, the Insee statistics agency said. Here, activity in the energy, water and extractive industries fell, while manufacturing production grew slightly in the European Union’s second leading economy.
Economists said both sets of data fell short of projections. “November’s disappointingly weak German and French industrial production figures provided further evidence that the hard data on the eurozone economy is failing to live up to the more optimistic picture painted by the surveys,” said Capital Economics economist Jessica Hinds.
German trade data also failed to live up to expectations, with exports edging up by a meagre 0.4% and the trade surplus contracting, the federal statistics office Destatis calculated.
But UniCredit economist Tobias Ruehl was more optimistic. “Fundamentally, the industrial sector in Germany is in good shape and at some point, positive developments in new orders will lead to increased industrial activity,” he said.
On Thursday, factory orders, a key measure of demand for goods in Europe’s top economy, rose in November, driven by robust domestic demand, the economy ministry said.
Ruehl noted that a preliminary estimate for full-year GDP growth was scheduled to be released next week. “Taking the latest data releases into account, we stick to our estimate of 1.7% year-on-year,” Ruehl said.
“Nevertheless, we see some downside risks to our fourth-quarter growth forecasts. However, this does not endanger our overall optimistic scenario for 2016,” he said.
Commerzbank economist Marco Wagner was more pessimistic, saying he was pencilling in growth of only around a quarter of a percentage point for the fourth quarter “at best.”
“And the turmoil in China and problems in other emerging markets give little reason to hope that growth will soon pick up again,” he warned.
Germany was the world's largest exporter from 2003 to 2008, a title now held by China. In 2011, Germany remained the third largest exporter and third largest importer. Most of the country's exports are in engineering, especially machinery, automobiles, chemical goods and metals. The country is also a leading producer of wind turbines and solar-power technology.