Dramatic decline: German exports to the USA at a record low!

Dramatic decline: German exports to the USA at a record low!

The uncertainty surrounding tariffs and threats from the United States has put German exporters in a difficult position. In May, exports to the USA fell by 7.7 percent compared to the previous month and, with a goods value of 12.1 billion euros, reached the lowest level since March 2022. This development represents the second decline in German exports in a row. Dirk Jandura, President of the export association BGA, described the situation in foreign trade as dramatic, while ING chief economist Carsten Brezski warns of a risk of further tariffs and speaks of a stagnating or shrinking economy. Loud rheinpfalz.de Weak foreign trade could even lead to a further recession in the German economy.

The export situation is further influenced by Donald Trump's recent decision to postpone the deadline for the introduction of new tariffs from the original July 9th to August 1st. Despite the delay, it remains unclear what impact this could have on the EU. An additional tariff package announced in April includes a base tariff of 10 percent on EU imports, as well as threats of up to 50 percent tariffs and high extra tariffs already introduced, including 25 percent on cars and auto parts and 50 percent on steel and aluminum. These general conditions not only put a strain on export figures, but also lead to a lower export expectations index from the Ifo Institute, which fell to minus 1.7 points in July, after minus 1.3 points in June.

Global trade development

The decline in exports is not limited to the US. Global exports fell by 1.4 percent to 129.4 billion euros in May. Exports to China fell by 2.9 percent to 6.8 billion euros, while exports to EU countries fell by 2.2 percent to 71.3 billion euros. However, there is a ray of hope on the horizon: exports to the United Kingdom rose by 15 percent to 7.2 billion euros. Thomas Gitzel, chief economist at VP Bank, noted that U.S. companies purchased more goods from German firms in the first quarter before the new tariffs took effect.

Imports and domestic market

Import figures also reflect weak market sentiment. In May, imports to Germany fell by 3.8 percent to 111.1 billion euros. Cyrus de la Rubia, chief economist at Hamburg Commercial Bank, interpreted this as a possible weakness in the domestic economy. The combination of falling exports and imports suggests that the German economy is facing major challenges, which is supported by various economic analyses.