The German economy is reporting surprisingly positive news. Exports of goods in May increased by 0.9 percent month-over-month, although analysts at Reuters had expected a decline of 0.3 percent. The data released by the German statistical office Destatis is particularly important because it comes at a time when the largest economy in the European Union continues to grapple with weak growth, expensive energy, and caution among businesses and households.
The May figures show that foreign demand for German goods remained stronger than expected. Conversely, imports fell by 2.5 percent after seasonal and calendar adjustments. As a result, the trade surplus increased to €19.1 billion, compared to €14.7 billion in April. This is a positive signal for Berlin, as exports have long been one of the main drivers of growth for the German economy.
However, the development was not uniform. Exports to countries within the European Union fell by 1.1 percent month-over-month, while exports outside the EU increased by 3.6 percent. It is precisely the stronger demand from third countries that boosted the overall result. This could also be important for German industry, which has faced weaker orders in recent years, pressure from cheaper competition from Asia, and uncertainty in global trade.
The positive export data follows another piece of good news from the German industrial sector. Destatis previously announced that industrial production in May rose by a real 0.9 percent compared to the previous month. In a three-month comparison from March to May, production was higher by 0.1 percent. This is not a sharp turnaround, but rather the first signs of stabilization after a prolonged period of weakness.
For Chancellor Friedrich Merz's government, these figures are welcome news. Germany is striving to restore its competitiveness, accelerate investment, and reduce bureaucracy. The May increase in exports alone does not solve the crisis of the German model, but it shows that the country's industrial base still has strength and can support the economy with favorable foreign demand.
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