Germany's trade surplus fell in 2021 on supply woes

FRANKFURT: Germany's trade surplus narrowed for the fifth year in a row in 2021, official data showed Wednesday, as a global supply crunch hampered exports, including in its key auto sector.

The trade balance of Europe's biggest economy showed a surplus of 173.3 billion euros ($197.9 billion) last year, down from 180.4 billion euros in 2020, the federal statistics office Destatis said in a statement.

Germany's is known for its export-driven economy, with the country usually racking up a trade surplus, where it exports more than the value of its imports.

While the industrial nation's exports of nearly 1.4 trillion euros in 2021 exceeded imports of 1.2 trillion euros, imports grew faster — by 17% — than exports which rose by 14%, Destatis calculated.

In December, the trade surplus was down on a seasonally adjusted basis to 6.8 billion euros from 10.9 billion euros in November.

In gross figures, the trade surplus was still down at seven billion euros.

The narrowing of the trade surplus was down to a stronger increase in imports in December, up 4.7% to 110 billion euros, than the growth in exports, which rose only 0.9% to 117 billion euros.

The United States maintained first place as the top destination for German exports ahead of China, while at the same time China remained the largest source for imports, ahead of the Netherlands in second place.

Germany's economy relies heavily on its exports from industries ranging from the auto sector to chemical products to machines.

But a global shortage of raw materials and key components has hampered production and forced stoppages in some industries, notably among car manufacturers.

Order books in industry were "still filled to the brim", but Germany "will first need to see industrial production picking up again before exports surge as well", said Carsten Brzeski, head of macro at the ING bank.