By Rene Wagner
BERLIN (Reuters) – German exporters are in the midst of an “extreme price squeeze” and are generating 70 billion euros ($ 14 billion) as producers and import prices surged, the German Chamber of Commerce and Industry (DIHK) said on Wednesday.
According to the calculation of the association, the export prices of German companies in the first half of the year increased by 14. 7%, but the producer and import prices rose by about
“In the first six months alone, Germany’s foreign trade burden reached 70 one billion euros,” Volker Treier, head of foreign trade at DIHK, told Reuters. Pass on some of the higher costs to overseas customers.
One problem is weakness in the euro, which has fallen below parity and to its lowest level in two decades against the dollar, which tends to make imports more expensive.
Despite Russia’s invasion of Ukraine, supply shortages and China’s coronavirus blockade, German exports actually rose 13% in the first half of the year .
But according to DIHK calculations, adjusted for inflation, it was negative in real terms: exports fell by 1.5%.
“This means that German foreign trade is already in recession,” Trier said.
According to the latest DIHK business survey, companies in key export sectors were particularly squeezed. For example, 35% of automakers say they will not pass on cost increases to customers, and 35% of pharmaceutical companies will not.
“There is currently no sign that this tension will be resolved anytime soon,” Treier said, adding that some companies are also concerned about China and its main market weak demand. U.S.
($1 = 1.0085 EUR)