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Roundup: German exports rebound in February

Xinhua, April 8, 2016 Adjust font size:

German exports rebounded in February following two consecutive monthly falls, official data showed on Friday, but analysts remained cautious about the country's foreign trade outlook.

In calendar and seasonal adjusted terms, German exports increased by 1.3 percent monthly in February, said German federal statistics office Destatis. It was the fastest growth since September 2015.

Imports also increased, but at a slower pace of 0.4 percent, thus expanding trade surplus of Germany to 19.8 billion euros (about 22.5 billion U.S. dollars) from 18.7 billion euros in January.

"After a weak year start, the exports now return to the old growth path," said Anton F. Boerner, President of German exporters' association BGA.

Foreign trade was Germany's main driving force in previous years but stuttered recently due to a subdued global recovery. In 2015, the German economy grew by 1.7 percent, mainly thanks to private consumption and government spending. Net exports only contributed 0.2 percentage points to the growth.

Compared with the same month of previous year, German exports increased by 4.1 percent in February. Exports to euro zone partners grew by 3.3 percent. Sales to non-euro European Union member states jumped by 9.3 percent. Demand from countries outside the Europe also went up by 2 percent.

Despite the rebound of exports, however, analysts remained cautious about the country's foreign trade outlook.

"February trade data just showed that the German export sector still struggles to gain momentum," said Carsten Brzeski, chief economist at ING DiBa bank, calling the revival of exports "some relief but no reason to cheer."

"Looking ahead, it does not look as if exports would quickly return as a powerful growth engine," he said. "Foreign orders have dropped by more than 7 percent since last summer... Moreover, the tailwinds of the weak currency are also fading away."

Earlier figures from Destatis showed that new orders received by German manufacturing factories declined by 1.2 percent, hindered mainly by falling demand abroad.

Last month, the German government's economic advisers cut their forecast for 2016 growth to 1.5 percent, attributing the downward adjustment to "somewhat weaker external demand."

BGA President Boerner warned on Friday that current economic, political and social challenges in Europe also posed uncertainties to German foreign trade.

"A proposed referendum on United Kingdom membership of the European Union, for example, would have major implications not only for the UK, but also for the remaining EU countries," he said. Endit