In December, Germany witnessed a significant drop in its exports, with a decline of 4.6% in comparison to the preceding month, according to the federal statistical office. This downturn surpassed initial predictions that had estimated only a 2% drop. In the preceding month, November, there had been a growth of +3.5%. Despite the export drop, December saw a surplus of 22.2 billion euros, marking an increase from November’s 20.7 billion euros, a figure which had seen an upward revision from 20.4 billion euros.
Meanwhile, imports in Germany experienced an even more drastic reduction, falling by 6.7% on a month-to-month basis. Taking into account the entire year of 2023, Germany’s exports amounted to goods valued at 1,562.1 billion euros, marking a 1.4% decrease from 2022, as reported by Destatis.
On the flip side, Germany imported goods valued at 1,352.5 billion euros. The trade balance for the year showed a surplus of nearly 210 billion euros. However, this didn’t prevent a shrinkage of the economy by 0.3% on an annual basis. The monthly decline in exports for December was majorly influenced by a reduction in flows to European Union countries, which fell by 5.5%, and a 6% decline towards the Eurozone. This is an indication of the general economic frailty of the Old Continent. Conversely, the rest of the world saw an increase in the absorption of “made in Germany” products (+3.5%) during the month, despite a 5.5% drop in exports to the United States, Germany’s largest customer. Exports to China, where the economy is experiencing a slowdown, fell 7.9%.
These figures attest to the challenging end to 2023 for the German economy. The industry remains in the red, grappling with high energy prices and interest rates, as well as a reduction in demand from its main customers such as China.
