Germany’s exports have plummeted after promising figures earlier in the year as concerns grow for the country that has been dubbed the “sick man of Europe”. Exports have dropped 1.7% month-on-month to €131.1 billion (£111bn) and 2.1% annually. Trade to the UK dropped by 2.1% to €6.3billion (£5.3bn).
Figures suggest that output in the manufacturing also sector dropped by 1.4% month-on-month in April and decreased by 1.8% compared to April 2024. In March, this had increased to 2.3% month-on-month, but fell 0.7% year-on-year. Imports, meanwhile, rose 3.9% from March to April, and by 3.8% on the year. Carsten Brzeski, boss of macro at ING, Germany’s third-largest bank, said: “Today’s industrial production data reflects the feared reversal of the frontloading effect of the first quarter and suggests that the structural weakness in industry is not over, yet.
“At the same time, however, there are growing indications that the German industrial cycle is gradually turning, as industrial orders have also improved and inventory levels have started to fall.”
It comes as German growth has been constrained by an ageing workforce, red tape, high energy costs and low productivity, Euronews reports.
German first-quarter growth came in “much stronger” than expected on the back of export and production frontloading, preparing for US tariffs.
ING wrote: “The German economy surged in the first quarter of the year on the frontloading of exports and industrial production. The just-released detailed GDP data was much better than the flash estimate’s result.
But experts added: “Looking ahead, the first quarter performance will soon become a positive one-off. The German economy remains in the middle of two seismic activities: a new government, which seems to lack strong ambition for structural reforms but will have access to unprecedented fiscal space for infrastructure and defence investments, and fundamental shifts in trade and geopolitics, including US tariffs.
“We think that, at least in the short run, the negatives will outweigh the positives, even though we are finally seeing tentative signs of a turning inventory cycle, which normally bodes well for industrial production over the coming months.
“Still, the tariff extravaganza since the beginning of April will leave clear marks on the German economy. There is the direct impact, as even with the current 90-day pause, tariffs are still higher than at the start of the year, but also the indirect impact via confidence and still high uncertainty.”
