By: Dr. Mike Campbell
Germany is usually described as the powerhouse economy of Europe, being the largest economy in the EU and the second largest exporting nation behind China. The nation is living up to this image and has just returned the best export figures in its history. The figures for March are the best since records began to be kept. The country managed to export €98.3 billion worth of products and services, providing the strongest data yet to suggest that the nation has put the worst of the global financial crisis firmly behind it. The March figure marked a 7.3% increase on the February level.
German imports were also at their highest level since records began to be kept in 1950, so German growth is stimulating economic output in other regions. The growth in economic output was stronger than analysts had expected.
Inevitably, strong output in Germany and France always leads to fears of a two-speed Europe within the Eurozone. France and Germany seem to be at the heart of the European recovery whilst other Eurozone economies, notably Greece and Portugal are in the slow lane and are still expected to be in a recessionary phase for the rest of the year. To an extent, this is an inevitable fact of economic life since the “peripheral nations” were in the minor leagues in comparison to Germany and France before there was a single European currency and indeed, it was never foreseen that a single currency would lead to a single-speed super-sized European economy. The aim of the venture was to provide a strong trading block that could compete on the world stage and remove barriers to trade within the single European market, thereby increasing European prosperity since much of the block’s trade is within its own membership.