Germany's trade surplus with US reaches new record
Germany's trade surplus with the U.S. expanded to 70 billion euros ($72 billion) in 2024, well above the previous record of 63.3 billion euros reported for the full year 2023.
"It would be hard to imagine worse timing," said Holger Goerg, from the Kiel Institute for the World Economy (IfW).
Trump substantially raised tariffs on steel and aluminum imports on Monday to a flat 25% "without exceptions or exemptions".
German Chancellor Olaf Scholz said in response the European Union was still awaiting formal notice of any new tariffs but that any such move would be met with retaliatory measures.
The increase in trade surpluses could reverse, Goerg said, if Trump imposed new tariffs on German imports, a measure the U.S. president says would boost U.S. manufacturing.
Germany, Europe's biggest economy, was last year the only G7 country posting a contraction for two consecutive years and a trade conflict with the U.S., its main trading partner, would deliver a big hit to output.
German exports to the U.S., led by cars and pharmaceutical goods, increased by 2.2% year-on-year to a record 161.3 billion euros in 2024, consolidating the U.S. position as the top buyer of goods "Made in Germany".
Imports from the U.S. fell by 3.4% to 91.4 billion euros last year.
Goerg said the U.S. trade deficit reflected a lack of international competitiveness of U.S. goods which will not be solved by tariffs.
"On the contrary, I would assume that this would have a negative impact on the U.S. export performance," Goerg said.
The situation is completely different in trade in services, where the U.S. has a strong export surplus, including to the EU and Germany, he noted. "Mr. Trump should include that in his calculations," Goerg said.
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