Page last updated at 10:14 GMT, Thursday, 9 October 2008 11:14 UK

German exports slump in downturn

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German exports have suffered from the global economic downturn

German exports suffered their biggest annual fall for five years in August in a clear sign that the global financial crisis is hitting the real economy.

The world's biggest exporter of goods saw year-on-year exports fall by 2.5% .

Exports fell from 87bn euros (69bn)in July to 75.7bn euros in August, a 13% drop, while imports fell from 73.2bn euros in July to 65.1bn euros.

The drop in exports was attributed to the strength of the euro and falling demand outside of the European Union.

Germany's overall trade surplus fell to 10.6bn euros from 13.8bn euros.

Germany is a very export oriented country, and our trade partners are not doing very well
Rainer Sartoris, HSBC Trinkhaus

The figures make grim reading for Europe's largest economy on the back of the IMF's World Economic outlook, published on Wednesday, which predicted a slowdown in growth from 2.5% last year to 1.8% this year.

Rainer Sartoris, an economist with HSBC Trinkhaus, said: "Exports are just not going so well anymore. Germany is a very export-oriented country, and our trade partners are not doing very well."

Andreas Rees, an economist with Unicredit, was more pessimistic: "The impact of the increasingly weak global economy is being felt strongly. That won't improve in the coming months - it's more likely to get worse.

"To me, it's clear that GDP shrank in the third quarter. Technically speaking, we are in a recession."

Looking at adjusted rather than unadjusted figures, year-on-year exports rose by 1.8% and the trade surplus widened to 13.1bn euros.


SEE ALSO
'Major global downturn' says IMF
08 Oct 08 |  Business
Eurozone services signal slowdown
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Robust trade aids German economy
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