Germany could shortly become Spain's main trading partner, as it already has the second largest share of Spanish exports (10.8%), only behind France, which due to the recession is increasingly purchasing fewer Spanish goods and services.
However, Germany is resisting the recession and at the moment its economy continues to grow, which explains why Spanish exports to this country are grew 7.4% in the first semester.
In the month of June alone, Spain has increased its sales to Germany by more than 200 million Euro compared to the same month last year, and although the recession has reduced the growth rate of German exports to Spain, Spanish and German entrepreneurs believe it to be a positive trend, as they consider that the bilateral trade balance needs to readjust.
Germany is the EU country with which Spain has the second largest trade deficit (the largest is with the Netherlands), amounting to 2,101.7 million Euro during the first semester, although the imbalance has been reduced by 52.3% in the last year.
Trade relations between both countries are very solid, especially in the automotive sector. In 2011, Germany imported cars and motorcycles from Spain with a value of 3,792 million Euro, 33.8% more than in 2010, while Spain bought German cars and automotive components with a value of 8,300 million Euro.
Further evidence for the complementarity of both economies are bilateral business investments, as well as the presence of over 900 German firms in the Spanish market, and another 200 Spanish firms in Germany, all of them creating employment.
According to data from the German Chamber of Commerce in Spain, the Spanish accumulated investment in Germany amounts to 15,000 million Euro, while the German investment in Spain stands at 30,000 million Euro and has generated close to 222 jobs.
According to the latest figures from the Foreign Investment Registry, during the first quarter of the year net German investments in Spain amounted to 953 million Euro, while in the entire year 2011 they were of around 1,196 million Euro.
Germany is the fifth largest investor in Spain, after Italy, France, the US and the UK, and its presence is especially relevant in newly established "greenfield" operations, as last year 45 projects of this sort received German investments and generated almost 4,000 jobs.
Among the German multinational firms established in Spain we find Seat, Lidl, Volkswagen, Deutsche Bank, Bayer, Allianz, E.ON, MAN, BMW, Adidas, Liebherr or Miele, while Spanish firms in Germany include Telefónica, Banco Santander, BBVA, Iberdrola, ACS and Abengoa.
Spain purchases mainly industrial technology, chemicals, mechanical and construction auxiliary industries, information and communication technology, as well as raw materials.
Germany buys mainly industrial technology, horticultural products, mechanical auxiliary equipment, fashion, meat and wine.
Source: Murciaeconomia