Germany, with its export-reliant economy, saw a drop in production as well as overall exports in 2024, according to data released by the Federal Statistical Office on Friday.

Data showed that Germany exported a total of €1.56 trillion ($1.62 trillion) in goods in 2024, down 1.0% from 2023. Imports were down sharper still (2.8%) to €1.32 billion.

Exports were a fourth-quarter drag on the German economy in 2024, though the trend reversed in December, with numbers clocking in 2.9% higher than November 2024 and 3.4% higher than December 2023.

The German Wholesale, Foreign Trade and Services Association (BGA) dubbed 2024 a "lost year" for German foreign trade. Projections for the coming year offer little optimism according to the BGA, which forecasts a further 2.7% drop.

Perhaps of most concern is the bleak outlookfor Germany's trademark automobile industry — with the metal industry looking anemic, too.

Lastly, waning industrial production — which dropped 2.4% in December to its lowest level since the start of the coronavirus pandemic — offered another indication that Germany's economy is sputtering. 

Trade surplus with the US will likely irk Trump

And yet, Germany managed to log a record trade surplus of €71.4 billion with the US, its biggest trading partner and the destination for more than 10% of its overall exports.

Trade between Germany and the US totaled €255 billion in 2024, outstripping €247 billion in German-Chinese trade.

In 2024, Germany had the biggest US trade surplus of any EU member state. Though that may seem like a good thing for the bloc's largest economy, it could further enrage US President Donald Trump, who has railed against EU trade policy and repeatedly threatened punitive tariffs.

Analysts have warned that if Trump were to follow through on tariffs it could knock as much as one percentage point off of GDP and lead to massive layoffs.

Observers such as Klaus-Jürgen Gern of the Kiel Institute for the World Economy (IfW) said it would be "particularly problematic if tariffs were to be imposed only on some products from Europe... especially those that play an important role for German exports, such as cars, pharmaceuticals and medical technology."

A big driver of German exports to the US have been so-called "green technologies" that were highly sought after by Trump's predecessor Joe Biden, who vowed to shift the US away from fossil fuels. Demand for those products will likely nosedive with Trump in office, however, as he has promised to roll back environmental policies in favor of drilling for oil and gas.

German finance minister recommends negotiating with Trump

German Finance Minister Jörg Kukies on Friday suggested the best way to avoid Trump's wrath over trade is likely to sit down and negotiate with him.

Speaking with Bavarian public broadcaster Bayerischer Rundfunk, Kukies noted that Trump has often said, "he'd like to export more energy to Europe… So that means we also have the possibility to offer negotiations that could lead to an agreement with one another before we get into a trade war."

Beyond Trump, Kukies said he "would encourage the EU Commission, which is responsible for EU trade policy, to sign many more trade deals."

Kukies spoke of the Gulf states, India, Indonesia and Malaysia in this context, saying he had gotten positive signals from all of them on the trade front, adding, "that is clearly of interest for our export-oriented economy."