Germany’s export-led economic model is facing sustained strain as demand from key markets, including the United States and China, continues to weaken. Economists warn that the slowdown is likely to persist, weighing on industrial output and broader economic growth.
German exporters, particularly in manufacturing-heavy sectors such as machinery, chemicals, and automobiles, have been hit by slowing global trade, higher costs, and subdued overseas investment. Reduced orders from major trading partners have added pressure to an economy already grappling with high energy prices and structural challenges.
Business surveys indicate that export expectations remain weak, with companies reporting limited visibility on recovery timelines. Analysts note that Germany’s heavy reliance on external demand leaves it especially exposed when global trade softens simultaneously in multiple large markets.
The prolonged export slump has raised concerns among policymakers about Germany’s long-term competitiveness. While diversification of trade partners and increased domestic investment have been discussed as potential responses, economists say any meaningful rebound will depend largely on a recovery in global demand.
