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Germany Economy Profile

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Economy - overview

The German economy - the fifth largest economy in the world in PPP terms and Europe's largest - is a leading exporter of machinery, vehicles, chemicals, and household equipment. Germany benefits from a highly skilled labor force, but, like its Western European neighbors, faces significant demographic challenges to sustained long-term growth. Low fertility rates and a large increase in net immigration are increasing pressure on the country's social welfare system and necessitate structural reforms.

Reforms launched by the government of Chancellor Gerhard SCHROEDER (1998-2005), deemed necessary to address chronically high unemployment and low average growth, contributed to strong economic growth and falling unemployment. These advances, as well as a government subsidized, reduced working hour scheme, help explain the relatively modest increase in unemployment during the 2008-09 recession - the deepest since World War II. The German Government introduced a minimum wage in 2015 that increased to $9.79 (8.84 euros) in January 2017.

Stimulus and stabilization efforts initiated in 2008 and 2009 and tax cuts introduced in Chancellor Angela MERKEL's second term increased Germany's total budget deficit - including federal, state, and municipal - to 4.1% in 2010, but slower spending and higher tax revenues reduced the deficit to 0.8% in 2011 and in 2017 Germany reached a budget surplus of 0.7%. A constitutional amendment approved in 2009 limits the federal government to structural deficits of no more than 0.35% of GDP per annum as of 2016, though the target was already reached in 2012.

Following the March 2011 Fukushima nuclear disaster, Chancellor Angela MERKEL announced in May 2011 that eight of the country's 17 nuclear reactors would be shut down immediately and the remaining plants would close by 2022. Germany plans to replace nuclear power largely with renewable energy, which accounted for 29.5% of gross electricity consumption in 2016, up from 9% in 2000. Before the shutdown of the eight reactors, Germany relied on nuclear power for 23% of its electricity generating capacity and 46% of its base-load electricity production.

The German economy suffers from low levels of investment, and a government plan to invest 15 billion euros during 2016-18, largely in infrastructure, is intended to spur needed private investment. Domestic consumption, investment, and exports are likely to drive German GDP growth in 2018, and the country’s budget and trade surpluses are likely to remain high.

GDP (purchasing power parity)
$4.199 trillion (2017 est.)
$4.099 trillion (2016 est.)
$4.012 trillion (2015 est.)

note: data are in 2017 dollars

GDP (official exchange rate)
$3.701 trillion (2017 est.)
GDP - real growth rate
0.59% (2019 est.)
1.3% (2018 est.)
2.91% (2017 est.)
GDP - per capita (PPP)
$50,800 (2017 est.)
$49,800 (2016 est.)
$49,100 (2015 est.)

note: data are in 2017 dollars

Gross national saving
28% of GDP (2017 est.)
28.2% of GDP (2016 est.)
28.1% of GDP (2015 est.)
GDP - composition, by end use
household consumption: 53.1% (2017 est.)
government consumption: 19.5% (2017 est.)
investment in fixed capital: 20.4% (2017 est.)
investment in inventories: -0.5% (2017 est.)
exports of goods and services: 47.3% (2017 est.)
imports of goods and services: -39.7% (2017 est.)
GDP - composition by sector
agriculture: 0.7% (2017 est.)
industry: 30.7% (2017 est.)
services: 68.6% (2017 est.)
Population below poverty line
16.7% (2015 est.)
Labor force
44.585 million (2020 est.)
Labor force - by occupation
agriculture: 1.4%
industry: 24.2%
services: 74.3% (2016)
Unemployment rate
4.98% (2019 est.)
5.19% (2018 est.)
Unemployment, youth ages 15-24
total: 6.2%
male: 7.1%
female: 5.1% (2018 est.)
Household income or consumption by percentage share
lowest 10%: 3.6%
highest 10%: 24% (2000)
Distribution of family income - Gini index
27 (2006)
30 (1994)
Budget
revenues: 1.665 trillion (2017 est.)
expenditures: 1.619 trillion (2017 est.)
Taxes and other revenues
45% (of GDP) (2017 est.)
Budget surplus (+) or deficit (-)
1.3% (of GDP) (2017 est.)
Public debt
63.9% of GDP (2017 est.)
67.9% of GDP (2016 est.)

note: general government gross debt is defined in the Maastricht Treaty as consolidated general government gross debt at nominal value, outstanding at the end of the year in the following categories of government liabilities (as defined in ESA95): currency and deposits (AF.2), securities other than shares excluding financial derivatives (AF.3, excluding AF.34), and loans (AF.4); the general government sector comprises the sub-sectors of central government, state government, local government and social security funds; the series are presented as a percentage of GDP and in millions of euros; GDP used as a denominator is the gross domestic product at current market prices; data expressed in national currency are converted into euro using end-of-year exchange rates provided by the European Central Bank

Inflation rate (consumer prices)
1.7% (2017 est.)
0.4% (2016 est.)
Central bank discount rate
0% (31 December 2017)
0% (31 December 2010)

note: this is the European Central Bank's rate on the marginal lending facility, which offers overnight credit to banks in the euro area

Commercial bank prime lending rate
1.67% (31 December 2017 est.)
1.78% (31 December 2016 est.)
Stock of narrow money
$2.453 trillion (31 December 2017 est.)
$2.016 trillion (31 December 2016 est.)

note: see entry for the European Union for money supply for the entire euro area; the European Central Bank (ECB) controls monetary policy for the 18 members of the Economic and Monetary Union (EMU); individual members of the EMU do not control the quantity of money circulating within their own borders

Stock of broad money
$2.453 trillion (31 December 2017 est.)
$2.016 trillion (31 December 2016 est.)
Stock of domestic credit
$5.033 trillion (31 December 2017 est.)
$4.433 trillion (31 December 2016 est.)
Market value of publicly traded shares
$1.716 trillion (31 December 2015 est.)
$1.739 trillion (31 December 2014 est.)
$1.936 trillion (31 December 2013 est.)
Agriculture - products
potatoes, wheat, barley, sugar beets, fruit, cabbages; milk products; cattle, pigs, poultry
Industries
among the world's largest and most technologically advanced producers of iron, steel, coal, cement, chemicals, machinery, vehicles, machine tools, electronics, automobiles, food and beverages, shipbuilding, textiles
Industrial production growth rate
3.3% (2017 est.)
Current Account Balance
$280.238 billion (2019 est.)
$297.434 billion (2018 est.)
Exports
$1.434 trillion (2017 est.)
$1.322 trillion (2016 est.)
Exports - commodities
motor vehicles, machinery, chemicals, computer and electronic products, electrical equipment, pharmaceuticals, metals, transport equipment, foodstuffs, textiles, rubber and plastic products
Exports - partners
US 8.8%, France 8.2%, China 6.8%, Netherlands 6.7%, UK 6.6%, Italy 5.1%, Austria 4.9%, Poland 4.7%, Switzerland 4.2% (2017)
Imports
$1.135 trillion (2017 est.)
$1.022 trillion (2016 est.)
Imports - commodities
machinery, data processing equipment, vehicles, chemicals, oil and gas, metals, electric equipment, pharmaceuticals, foodstuffs, agricultural products
Imports - partners
Netherlands 13.8%, China 7%, France 6.6%, Belgium 5.9%, Italy 5.4%, Poland 5.4%, Czechia 4.8%, US 4.5%, Austria 4.3%, Switzerland 4.2% (2017)
Reserves of foreign exchange and gold
$200.1 billion (31 December 2017 est.)
$173.7 billion (31 December 2015 est.)
Debt - external
$5.326 trillion (31 March 2016 est.)
$5.21 trillion (31 March 2015 est.)
Stock of direct foreign investment - at home
$1.653 trillion (31 December 2017 est.)
$1.391 trillion (31 December 2016 est.)
Stock of direct foreign investment - abroad
$2.298 trillion (31 December 2017 est.)
$1.981 trillion (31 December 2016 est.)
Exchange rates
euros (EUR) per US dollar -
0.885 (2017 est.)
0.903 (2016 est.)
0.9214 (2015 est.)
0.885 (2014 est.)
0.7634 (2013 est.)
Fiscal year
calendar year

Source: CIA World Factbook
This page was last updated on Friday, November 27, 2020