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What does Germany need?

· Helfen statt Blockieren editorial team

Few large economies depend on world trade as much as Germany: imports and exports together equal almost 80 percent of output, against a quarter in the United States. Yet Germany’s share of world merchandise exports has fallen from 8.5 to 6.7 percent since 2000, and in 2026, according to the IMF, Germany grows by 1.3 percent, slightly faster than the euro area but less than half as fast as the world. What the country needs is described in strikingly similar terms by the IMF, economic institutes and businesses.

79.1%trade as percent of GDP in 2024; US 25.0, world 56.7World Bank
6.7%share of world merchandise exports in 2025; 2000: 8.5 percentWorld Bank, WTO data, own calculation
1.3%growth in 2026 according to the IMF; euro area 1.1, world 3.1IMF, October 2026
€251.8 bntrade with China in 2025, again the largest partner ahead of the USDestatis

Where Germany stands

According to the IMF’s World Economic Outlook of October 2026, Germany grew by 0.2 percent in 2025; growth is projected at 1.3 percent in 2026 and 1.1 percent in 2027. The euro area stands at 1.2, 1.1 and 1.2 percent, the United States at 2.3 percent in each year, China at 5.0, 4.5 and 4.0 percent, and the world at 3.5, 3.1 and 3.4 percent. In February the IMF still expected 1.1 percent for 2026. The joint forecast of the institutes DIW, ifo, Kiel Institute, IWH and RWI arrives at the same 1.3 percent in September 2026 but expects only 0.4 percent for 2028: the economy is reaching the limit of its capacity because the number of people of working age is falling.

Growth compared, 2025 to 2027

Real gross domestic product, change on previous year in percent; 2026 and 2027 IMF projection. India: fiscal year.

Economy202520262027
Germany0.21.31.1
Euro area1.21.11.2
United States2.32.32.3
China5.04.54.0
India7.87.07.0
World3.53.13.4

Source: IMF, World Economic Outlook October 2026, table 1.1, and IMF DataMapper (NGDP_RPCH), accessed 3 Nov 2026; daten/ergebnis_iwf_wachstum.csv.

The six years since 2019 in detail, with industrial production, energy prices and insolvencies, are shown in The case of Germany; this analysis does not repeat those figures but asks what is needed.

An exporting country in transition

In 2025, according to Destatis, Germany exported goods worth 1,563.0 billion euros, 0.9 percent more than in 2024, and imported goods worth 1,362.5 billion euros, 4.3 percent more. The surplus fell from 242.9 to 200.5 billion euros. China is again the largest trading partner (251.8 billion euros), but in one direction: exports to China fell by 9.7 percent to 81.3 billion euros, imports rose by 8.8 percent to 170.6 billion euros. Goods worth 146.2 billion euros went to the United States, 9.4 percent less.

In the first half of 2026 total exports grew by 3.9 percent. Exports to the US fell further by 6.1 percent and to China by 12.2 percent, while exports to France rose by 7.6 percent and to the Netherlands by 9.0 percent (Destatis). Demand is therefore increasingly coming from Europe, while the two large markets outside are weakening, for different reasons: tariffs in the US, domestic production and weak demand in China.

Shares of world merchandise exports, 2000 to 2025

Percent of the value of all world merchandise exports in US dollars. Exchange rates affect the shares.

YearChinaUnited StatesGermanyJapan
20003.812.18.57.4
20014.311.79.26.5
20025.010.69.46.4
20035.79.59.96.2
20046.48.89.86.1
20057.28.59.25.6
20067.98.49.15.3
20078.68.19.45.1
20088.87.98.94.8
20099.58.38.94.6
201010.38.38.25.0
201110.38.08.04.5
201211.08.37.54.3
201311.68.37.63.8
201412.38.57.83.6
201513.79.08.03.8
201613.09.08.34.0
201712.78.78.13.9
201812.78.57.93.8
201913.18.67.83.7
202014.68.07.83.6
202114.87.87.33.4
202214.28.26.73.0
202314.18.47.13.0
202414.58.46.82.9
202514.38.36.72.8

Source: World Bank, World Development Indicators, TX.VAL.MRCH.CD.WT (WTO data), as of 8 Oct 2026; shares: Helfen statt Blockieren, daten/ergebnis_wb_anteil_warenausfuhr.csv.

The share of world merchandise exports shows the longer trend. Germany stood at 8.5 percent in 2000 and 6.7 percent in 2025; the United States fell from 12.1 to 8.3 percent, Japan from 7.4 to 2.8 percent. China rose from 3.8 to 14.3 percent. The decline is therefore not a German peculiarity but the result of China’s rise, and Germany held on to its share longer than the US and Japan. At the same time, no large country is as open: trade equals 79.1 percent of German GDP, against a world average of 56.7 percent.

How open economies are, 2024

Imports and exports of goods and services combined, percent of gross domestic product.

EconomyTrade, % of GDP
EU (incl. intra-EU trade)91.6
Germany79.1
South Africa61.6
World56.7
Saudi Arabia56.4
India45.9
Japan44.9
Russia39.4
China38.0
Brazil35.6
United States25.0

Source: World Bank, World Development Indicators, NE.TRD.GNFS.ZS, as of 8 Oct 2026; daten/ergebnis_wb_handel_bip.csv.

What Germany needs

More people in work

The IMF wrote in February 2026 that the working-age population will shrink more sharply over the next five years than in any other G7 country. It recommends better childcare, lower effective tax rates for second earners and low earners, and better integration of immigrants into the labour market. The joint forecast sees this as the limit to growth after 2027.

Less red tape and more private investment

The IMF advises reducing the administrative burden. In 2025 the European Investment Bank surveyed more than 12,000 firms in the EU: 83 percent cite uncertainty as a barrier to investment, 79 percent the shortage of skilled staff, 75 percent energy costs. Only 26 percent of EU firms plan to expand their operations over the next three years, against 37 percent in the US.

Affordable energy

According to the joint forecast, the energy price shock after the war with Iran has weakened purchasing power and slowed the recovery. The IMF assumes an average oil price of 96 US dollars a barrel in 2026, after 67.74 in 2025. For a country with a lot of energy-intensive industry, this weighs more heavily than for the United States, which produces its own oil and gas.

A completed single market

Germany’s largest market is Europe, and that is where the largest reserves lie. According to the IMF, the barriers between EU countries act like a tariff of around 45 percent on goods and about 110 percent on services; between US states the figure for goods is about 15 percent. More on this in the analysis Where the EU falls short, and where it does not.

More diversified markets

New agreements create alternatives. Negotiations with India were concluded on 27 January 2026; the agreement is to eliminate or reduce tariffs on over 96 percent of EU exports to India, and the Commission estimates savings of around 4 billion euros a year. It has not yet been signed. The agreement with Mercosur has been provisionally applied since May 2026.

Two readings

The case for confidence

  • The situation is better than its reputation: exports grew by 3.9 percent in the first half of 2026, and the IMF has raised its forecast.
  • The loss of world market share is mainly due to China’s rise and is smaller than that of the US and Japan.
  • The IMF sees the output gap closed in 2027.

The case against

  • The joint forecast expects only 0.4 percent growth for 2028 and a government deficit of 4.7 percent of GDP; it calls fiscal policy “off course”.
  • In trade with China, Germany ran a deficit of almost 90 billion euros in 2025; imports grew by 8.8 percent, exports fell by 9.7 percent (Destatis).
  • According to the Kiel Institute, a hard decoupling from China would cost Germany around 4 to 5 percent of national expenditure in the short run and 1 to 2 percent permanently.

Check the numbers: daten/abruf.py downloads the IMF, World Bank and uncertainty series; the extracts are in daten/ergebnis_*.csv, values taken from reports in daten/werte_berichte.csv.

This analysis is information, not legal, tax or investment advice. It reflects the view of the editorial team, presents arguments from both sides and makes no forecast of its own. “Helfen statt Blockieren” is non-partisan.

Sources

All online sources accessed on 3 November 2026. Secondary sources are marked; the figures there come from the publisher named.

To the situation report Blockades and the world economy 2026