The European Commission and now America have chided Germany for the depressing effects of its trading successes on the rest of the European Union. But as our secret columnist in Brussels Schadenfreude says, it is not Germany’s fault that it is better than the rest
There is sometimes too much of a good thing. Governments like to have a balance of payments’ surplus. It is good for national finance, for the value of the currency and for morale. Britain does not have one. It was already a problem in the 17th century restoration of the monarchy, when a new royal edict called for examination of “whether the importacion of foreigne commodities do not overbalance ye exportacion of such as are native”.
In the tense 1960s, the United Kingdom published monthly import/export statistics. These were pored over to gauge the effect on markets. Today, if they are published at all the figures receive little notice. Britain has an annual balance of payments deficit of more than $100bn – receiving only passing attention among financial commentators.
The UK government provides a range of export services, including export insurance. This branch of activity has undergone a change of heart. In the early years of the century, the British Treasury concluded that help to exporters – at home and in the commercial departments of embassies and high commissions – was unremunerative and should be cut back, the Conservative-Liberal coalition changed course and decided that ambassadors should become super salesmen.
Ministers routinely include high-level salesmen in their retinues on foreign trips. There was also, briefly, a regal special representative for trade and investment – able to open doors at the highest level. There can be too much of a good thing. Germany runs a colossal balance of payments surplus, which means correspondingly large deficits elsewhere.
The European Commission has chided Germany for the depressing effects of its trading successes on the rest of the European Union. Now the United States Treasury has joined in to criticise Germany’s ‘anaemic’ internal demand and to call for changes, which would give the rest of the world improved opportunities for sales to Germany.
But the proud nation is unlikely to pay much attention. Its domestic policies are intentionally tight and it is not Germany’s fault that it can supply its own needs efficiently, without requiring much of a contribution from outside. They do not need to say ‘buy German’. It happens, at home and abroad.