Economic Doghouse: Complaints About German Exports Unfounded

One country’s success with exports should generate appreciation for competition and not envy, suggests a German publication. The US Department of Treasury released a report that notes “Germany’s anemic pace of domestic demand growth and dependence on exports have hampered rebalancing at a time when many other euro area countries have been under severe pressure to curb demand and compress imports.” For 2012, Germany’s nominal current account surplus was larger than China’s, or 7 percent of annual economic output: “This forces the European Commission to intervene because the average value over the course of three years cannot exceed 6 percent,” reports Spiegel Online. Some resentment stems from Germany’s austerity proposals for other nations struggling with debt. German officials resist interference in labor markets or wage rates and insist their overseas factories and supply chains create jobs for other countries: German cars include parts and materials produced in numerous countries, which represented 20 percent of inputs in 2008; Volkswagen is Portugal’s largest foreign investor. Reining in one nation’s success won’t boost the fortunes of others. – YaleGlobal