A quiet
revolution is taking place far from the usual headlines: Despite the havoc
wrought by the international financial crisis, European companies are
performing exceedingly well in comparison to their American counterparts.
Export-oriented businesses are contributing significantly to this development,
even outpacing lower-cost rivals from China. Key to this phenomenon is
increasing globalization that lends added importance to the share of foreign
sales, which account for 39 percent of sales for Europe as a whole, versus 30
percent for the US.
For numerous German companies, exports account for over 80 percent of all sales
(Newsweek).
According to
research conducted by Deutsche Bank, Germany's GDP has grown by an
astounding 2.2 percent in the second quarter, which would bring the annual
growth for 2010 to 3.5 percent. This is largely due to the good performance of
the country's export sector. Marring this picture are fears that this trend
will weaken significantly in the second half of 2010, because of the long-term
effects of necessary fiscal consolidation in a number of European countries.
The German economy is increasingly feeling the repercussions of developments in
other countries. In recent months, as French and British markets have more and
more turned toward southern Europe, expectations for Germany's growth rate for
2011 would have to be downgraded: It is now expected not to exceed 1.5 percent
(Deutsche
Bank Research).
In early
September, a meeting that brought record attendance numbers to the Federal
Foreign Office underlined the prominence of exports for the German economic
policy: Around 1,000 delegates representing more than 500 companies gathered
for the annual business forum at the Ambassadors Conference. The ensuing
discussion addressed concerns ranging from the issuance of business visas, to Germany's economic presence in Latin America and
the Caribbean, as well as to the question of
whether the spread of Western values adds competitive advantage to business
activities internationally (Auswaertiges
Amt).
Hosted by
Foreign Minister Guido Westerwelle and Economics Minister Rainer Bruederle, the
event brought together Germany's
leading diplomats and the heads of principle companies active in the field of
exports. As Minister Westerwelle stressed in his opening statement, it is
becoming increasingly important to use the extensive worldwide networks
established by the German Foreign Service for the benefit of the country's
businesses. This was particularly true as it would pertain to those small and
medium sized businesses that seek to gain a foothold in foreign markets.
Moreover, besides the mercantile interests involved, German businesses would
also act as vehicles for promoting the cause of human rights and the rule of
law around the world. Internationally, governments are growing increasingly
sensitive to investors' concerns, as they become more and more aware that
foreign monies will flow only where a safe investment climate guarantees
returns (Auswaertiges
Amt).
During a
talk at the Federal State of Hesse's Office in Berlin
(Hessische Landesvertretung Berlin)
on September 14, United States Ambassador Philip D. Murphy also focused on the
central importance of the transatlantic relationship and German-American
friendship for overcoming the detrimental effects of the international
financial crisis. As Ambassador Murphy pointed out during the discussion, even
though transatlantic topics may well have become less tangible in the post-Cold
War era, their importance has been on the rise. This is particularly true of
areas such as economics and finance, climate change, and security threats such
as cyber warfare. For the United States,
a strong and successful Germany
was a crucial driving force behind European integration, and for ensuring peace
and stability on the continent (Hessische
Staatskanzlei).
Photo licence: cc by Auswaertiges Amt
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