Welcome back to Macro Framework! Our previous (and first!) MF post was on the two largest economies, the US and China. Germany is the fourth largest economy.
Top Exports/Imports in 2021
From China to Germany, the top exports are computers, machine parts, and broadcasting equipment, all relating to technology. From Germany to China, it’s also rather specific. The top exports are cars, car parts, and planes/helicopters/spacecraft.
China is Germany’s biggest trade partner. In 2022, the value of Germany’s exports was 106.8 billion euros, whereas the value of China’s exports was 191.1 billion euros. Therefore, Germany has an 84.3 billion euro trade deficit with China.
Separation: Not Currently Happening
Like a lot of the West, there have been increasingly loud voices questioning the heavy reliance on Chinese imports. However, the situation has worsened in the past two years due to the Ukraine war when Germany imported Chinese chemicals in fear of an energy shortage.
While that was not a long-term concern, in the past year, other issues have grown more evident. Foreign demand for German manufactured goods has fallen. Other EU countries have increased their exports to China while Germany has experienced the opposite.
Chinese consumers have increasingly purchased cars from domestic carmakers. Another factor is that carmakers have fewer small electric vehicle models to choose from.
A Telling Visual
Basic Info from 2022
Germany’s GDP is $4.07 trillion, and the country’s population is around 83.3 million. The life expectancy in Germany is 81.72 years. There are 40.9 million households with an average of 2 people per household. The median income is about 44,000 euros or around 48,500 dollars annually.
As previously mentioned, China has the world’s second-biggest economy with $17.9 trillion in GDP. The country is the world’s most populous country, with 1.4 billion people. Life expectancy is at 77.3 years. There are 494.1 million households (2021) with an average household size of 2.7 people. There are conflicting numbers for median income, but the median per capita disposable income is 31,370 yuan or around 4371.3 dollars.
Read about the ongoing vessel attacks in the Red Sea here.