US be­comes Ger­many's big­gest trad­ing part­ner

The Pak Banker - - MAR­KETS/SPORTS -

The United States over­took France to be­come Ger­many's most im­por­tant trad­ing part­ner last year for the first time in 40 years, of­fi­cial data showed to­day. The de­vel­op­ment, which had al­ready started to be­come dis­cernible in the mid­dle of last year, was con­firmed by pro­vi­sional data pub­lished by the fed­eral sta­tis­tics of­fice Des­tatis: for the first time since 1975, France is no longer Ger­many's big­gest trad­ing part­ner.

Ex­change rate fluc­tu­a­tions and the vigour of the US econ­omy are largely be­hind the change in rank­ing.

But the de­vel­op­ment ap­pears to carry spe­cial po­lit­i­cal res­o­nance at a time when Europe is fight­ing to hold to­gether against the back­drop of the refugee cri­sis.

France has al­ways been seen as Ger­many's pri­mary trad­ing part­ner in the past, un­der­lin­ing the close po­lit­i­cal and eco­nomic ties be­tween Europe's num­ber one and num­ber two economies.

But the weak­ness of the euro against the dol­lar and the pick-up in the US econ­omy has boosted Ger­many's transat­lantic trade.

"Ac­cord­ing to pro­vi­sional data, goods worth a to­tal 173.2 bil­lion eu­ros ($188bn) changed hands be­tween Ger­many and the US in 2015," the fed­eral sta­tis­tics of­fice Des­tatis cal­cu­lated.

"That meant the US was Ger­many's most im­por­tant trad­ing part­ner in 2015, fol­lowed by France with 170.1bn eu­ros worth of goods and the Nether­lands with 167.6bn eu­ros," the state­ment said.

In terms of ex­ports, the US was the big­gest for­eign buyer of Ger­man-made goods in 2015, with ex­ports amount­ing to 113.9bn eu­ros last year.

Ex­ports to France, the coun­try to which Ger­many has ex­ported the most ev­ery year since 1961, amounted to 103bn eu­ros. The United Arab Emi­rates fol­lowed in third place, with ex­ports to­talling 89.3bn eu­ros.

On the im­port side, Ger­many im­ported the most goods from China last year - 91.5bn eu­ros in all. The Nether­lands and France fol­lowed in sec­ond and third places with im­ports of 88.1bn eu­ros and 67bn eu­ros re­spec­tively, Des­tatis cal­cu­lated.

An­ton Bo­erner, pres­i­dent of the Ger­man ex­porters' fed­er­a­tion BGA, saw the de­vel­op­ment as a "turn­ing point, a long-term phe­nom­e­non," even if France would def­i­nitely re­main "a very im­por­tant part­ner, and po­lit­i­cally the most im­por­tant one" for Ger­many.

Chan­cel­lor An­gela Merkel is sched­uled to travel to Paris on Fri­day to meet with Pres­i­dent Fran­cois Hol­lande, ahead of a cru­cial EU sum­mit on refugees next week.

For France, Ger­many re­mains its big­gest trad­ing part­ner, with 16pc of French ex­ports des­tined for its Euro­pean neigh­bour and 17pc of its im­ports com­ing from the other side of the Rhine.

But in the US, the eco­nomic up­turn there has led to a rise in de­mand for Ger­man-made goods, with chem­i­cal ex­ports to the US ris­ing by 10pc, ma­chin­ery ex­ports up 12pc, cars and car parts up 23pc.

The US has even over­taken China as the big­gest cus­tomer for ma­chine tools made in Ger­many, said Ralf Wiech­ers, econ­o­mist of the spe­cial­ist in­dus­try fed­er­a­tion VDMA.

The ma­chine tool sec­tor ac­counts for nearly 10pc of all Ger­man ex­ports and France re­mains the num­ber three cus­tomer. "But we're start­ing to worry about the tis­sue of French in­dus­try," said Wiech­ers. "For years now, France has pur­sued an in­dus­trial pol­icy favour­ing large com­pa­nies" and that has eroded the base of dy­namic small and medium-sized en­ter­prises.

The health of Europe's two big­gest economies also di­verges pro­foundly in terms of com­pet­i­tive­ness, trade bal­ance and pub­lic fi­nances.

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