The FT's newly ordained "person of the year", the ever sardonically smiling ECB president, Mario Draghi, recently addressed Germany's co-operative banks: eurozone trade, he claimed, accounted for a staggering 40% of Germany's entire GDP. Not a single eyebrow was raised in the audience. The truth is somewhat different: total exports are equivalent to around 43% of Germany's GDP and the eurozone accounts for less than 37% of total exports, according to recently revised figures. That means that exports to the eurozone nominally account for roughly 15% of German GDP. This share will fall further. In reality, however, the contribution of the eurozone to the German economy is even smaller. The reason for this is simple: the eurozone countries do not pay for most imports from Germany; most of Germany's current account surplus is financed by the Bundesbank.
Between 1998 and 2011, German exports grew by over 115%. Export growth, however, did not translate into economic growth. According to Eurostat, during 1998-2011 Germany grew at an average annual rate of close to 1.4%, compared to around 1.5% for France, 1.8% for the Netherlands, 2.7% for Sweden, 2% for Britain, and average growth of 1.7 % for the EU as whole. Germany also lagged significantly behind the United States which achieved over 2%. Only Japan, Italy, Portugal and, according to some calculations, Denmark performed worse than Germany.
While German industry has enjoyed record export and profit growth, ordinary Germans have not had much economic joy over the past 13 years. As Charles Dumas of Lombard Street Research has demonstrated, real personal disposable income per capita rose by just over 7% from 1998 to 2011, compared to growth of 13% for Spain and around or over 18% for Britain, France and the US. German income growth lagged behind almost all OECD countries; only Italy and Japan performed worse. Germany today is a poorer country compared to many EU members than it was in 1998.