The Soviet Union had only just collapsed. John Major was still a relatively fresh-faced Prime Minister. And the internet consisted of a few desktop computers linking together a handful of laboratories. The world was a very different place when Germany last posted a trade deficit way back in 1991. But on Monday, the country recorded that imports outstripped exports for more than 30 years. True, other countries are recording huge deficits, not least the UK. For Germany, though, it matters more. Its entire economy has been built around creating an industrial machine that dominates global markets. That machine is now grinding to a halt.
By the standards of Britain, the United States, or indeed France, the €1 billion deficit that Germany announced today might seem like a mere accounting error. Exports unexpectedly fell, while imports surged as the cost of energy spiked.
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