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The Role of Germany in the Global Economy-Robin Trehan

Oct. 10, 2009 8:33 PM ET
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The top economies in the world are the U.S., Germany and Japan. The three are also known for having the world’s most dominant central banks. But out of the three, Germany’s economy is known for being smaller and more vulnerable than the others. To give you a better idea, Germany’s GDP of DM3 trillion is about 1/3 of America’s GDP and about half of Japan’s GDP. Even with that being known, Germany still has an exerted powerful influence on the global economy. Ever since WWII ended, the Federal Republic has been a key player in the beginning, managing and ending of each crisis that has occurred to the global monetary system.

Germany has a very high demand on exports and the country is still interested in additional open markets. Its most important partners to trade with include the United States, Great Britain and France. Three years ago, back in 2006, EUR 85 billion worth of goods and services were exported to France, EUR 78 billion of the goods and services were exported to America and EUR 65 billion worth of goods and services were exported to Great Britain.

Between 2004 and 2007, Europe began to expand eastward. So other than just trading with the usual European Union member states, it was trading with the eastern European EU member states as well. About ten percent of the total exports are made to these countries. The continuous of Asian countries, like China and India are dependent upon trade. In 1993, Germany made EUR 33 billion worth of exports to the Asian regions, which in was more than three times this amount in 2006, EUR 104 billion. The amount of counties in Asia has rose from 1,800 to 3,500 between the ‘93 and ‘06 period. The direct investments have quadrupled over this time period as well.

It seems like Germany has been quite busy even if it is the smallest of the top economies in the world. The country is doing great at proving to be one of the top economies on a global scale and are doing their part in playing the role of a powerful influence on the global economy.

Robin Trehan, is associted with private equity group of Credit Capital Funding. Also. More information www.creditcapitalfunding.com and www.businesscreditfunding.com

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