Germany's significant trade surplus with America could soon come back to bite it, according to a new analysis.
It comes as Donald Trump delays slapping a 50 per cent tariff rate on all European goods from June 1 to July 9.
European stock markets rallied on Monday following the announcement, with Trump claiming the reprieve pushed the bloc to speed up negotiations.
"I was extremely satisfied with the 50 Tariff allotment on the European Union, especially since they were slow walking (to put it mildly!), our negotiations with them," the US president said in a post on Truth Social on Tuesday.
Although Brussels will be breathing a sigh of relief, Germany has few reasons to be cheerful.
Facts4EU’s analysis of the latest figures published in the database of the German Federal Statistical Office shows that Germany is responsible for a significant chunk of America's trade deficit with the bloc.
In the first quarter of this year - and therefore before the entry into force of higher tariffs on exports from the EU to the United States – Germany recorded a considerable export surplus with the US (see chart below).
In the first quarter of this year, Germany recorded a considerable export surplus with the US
Facts4EU
From January to March this year, Germany exported goods to the tune of $43.5billion to the US and imported goods to the value of $24.8billion from it.
The trade balance in goods in Q1 therefore records a trade surplus in goods of $24.8billion. As the German Federal Statistical Office points out, exports from Germany exceeded imports from the US by almost 75 per cent.
So far this year, at $24.8billion, Germany's export surplus in the trade of goods with the US was the highest among all its trading partners in the World. It was 38 per cent higher than the surplus with France, its neighbour and the country with which Germany has the second largest export surplus.
Germany also recorded a significant trade surplus with Uncle Sam last year year before, amounting to $75.6billion.
Germany also runs a significant trade surplus with Britain.
As the Facts4EU investigation shows, in the first three months of this year, Germany exported $21.1billion of goods to the United Kingdom and bought a mere $11.1billion of British goods in return (see chart below).
In the first three months of this year, Germany exported $21.1billion of goods to the United Kingdom and bought a mere $11.1billion of British goods in return
Facts4EU
A reckoning is coming
As Facts4EU point out, Germany's economy relies on exports far more than does the UK's, so any hit to exports to the US will be noticeable in its overall GDP, large though that is.
Germany’s economy is already buckling under high energy costs as a result of the Ukraine war, weakening demand from China, and increasing competitive pressure from Asian goods.
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