The latest figures show that German exports fell 3.6% in October on the back of falling demand from crisis-hit southern European markets.
Meanwhile, the trade deficit in the UK narrowed sharply in October thanks to the value of its exports, which hit a record high.
October’s fall in October was the country’s largest in six months, and outdid the previously expected 1% decline by a wide margin.
October’s performance showed an additional 1% contraction from the previous month’s figures, a figure that was also vastly underestimated by official growth forecasts.
The data is troubling news for Europe’s largest economy, and particularly grim tidings for a crisis-wrought eurozone. As the crisis continues, global markets are feeling the results, with Germany being no exception.
In addition, major players in global manufacturing have made statements about the eurozone’s effect on exports, including China, Brazil, and India.
While Germany is in a much better position to take the hit than many fellow eurozone states, the export and manufacturing slump has dealt a major blow to its trade surplus. The surplus fell from 17.3 billion euros to just 11.6 billion euros (£9.9 billion). This totals about 5.5% of Germany’s national output, or GDP.
Holger Schmieldling, an economist at German Berenberg Bank, has said that the slump in the German economy can is illustrated greatest by its fall in exports.
He blamed the eurozone debt crisis, saying that “Germany can’t remain an island of tranquillity” if its neighbour states are failing.
In contrast with Germany’s contraction and France’s 0% growth reading for industrial output, figures from the Office for National Statistics show that the UK’s deficit in goods fell to £7.6 billion. This figure is down sharply from September’s £10.2 billion deficit.
In the UK, export of goods has risen to a record £26.5 billion, while imports fell from £34.6 billion in September to £34.1 billion in October.
The science and research branches of the manufacturing sector are pulling their weight to get the British economy moving again, as the ONS reports a particularly strong rise in exports of chemicals, medical products, and telecoms equipment.
Despite the heartening news from the manufacturing and exports sectors, economists continue to have a bleak outlook on the future. The October’s surprising improvements are not likely to be repeated, experts say.