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Germany hits back at US criticism over economy

Germany on Thursday rejected as"incomprehensible" criticism levelled by the US Treasury that Berlin should do more to increase its domestic demand and rely less on exports in order to help boost the global economy.

Published: 31 October 2013 15:29 CET
Germany hits back at US criticism over economy
Photo: DPA

"The criticism is not comprehensible," the economy ministry said in a written statement. 

"The current account surplus is an expression of the strong competitiveness of the German economy and of international demand for high-quality products from Germany," it said.

On Wednesday, a US Treasury report pointed the finger at Germany, saying that it needed to tap its surpluses to boost demand and help the eurozone pull back from deflation.

Its "anemic pace of domestic demand growth and dependence on exports have hampered rebalancing at a time when many other euro-area countries have been under severe pressure to curb demand and compress imports," it said.

The critical report comes amid already strained German-US ties over reported US bugging of Chancellor Angela Merkel's phone.

Germany's current account surplus is "no cause for concern" for Germany,the eurozone or the world economy, retorted the German finance ministry in a statement.

It said there were "no imbalances" that called for a correction in German economic and budgetary policy and also pointed to "robust" salary growth, a gradual resumption of investment and increasing private household consumption.

Germany, which as Europe's biggest economy was looked to for help in leading the 17-nation eurozone out of its financial and debt crisis, has encountered similar calls to boost domestic demand in the past.

Its economic policy is set to change, albeit slightly, because Merkel's conservatives are currently negotiating to form a grand coalition with the Social Democrats whose key election issue was a national minimum wage.

German retail sales also fell slightly for the second consecutive month in September, official data showed on Thursday.

Retail sales slipped by 0.4 percent in September compared with August, the federal statistics office Destatis said in a statement. Retail sales had already contracted by 0.2 percent in August.

But over a 12-month period business improved for retailers, with sales showing a modest increase of 0.2 percent in September compared with the same month last year, the statisticians calculated.

READ MORE: EU-US deal would create '160,000 German jobs'

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TRADE

Norway and UK strike post-Brexit trade deal

Norway and the United Kingdom have struck an agreement on a free trade deal, the Norwegian government announced on Friday.

Published: 4 June 2021 13:51 CEST
Norway and UK strike post-Brexit trade deal
Erna Solberg outside 10 Downing Street in 2019. (Photo by LUDOVIC MARIN / POOL / AFP)

Negotiations over the agreement have been ongoing since last summer, and the Norwegian government said that the deal is the largest free trade agreement Norway has entered into, outside of the EEA agreement. 

“The agreement entails a continuation of all previous tariff preferences for seafood and improved market access for white fish, shrimp, and several other products,” the Ministry of Trade and Industry said in a statement.  

One of the sticking points of the negotiations was Norway wanting more access to sell seafood in the UK, while the UK wanted more access to sell agricultural products like cheese.

The latter was a problem due to Norway having import protection against agricultural goods. 

“This agreement secures Norwegian jobs and value creation and marks an important step forward in our relationship with the UK after Brexit. This is a long-term agreement, which at the same time helps to accelerate the Norwegian economy,” Prime Minister Erna Solberg said in a statement.  

 The United Kingdom is Norway’s second most important single market, after the EU. In 2020 Norwegian companies exported goods worth 135 billion kroner to the UK and imported around 42 billion kroner of goods from the UK. 

Norway has given Britain 26 quotas on agricultural products, but not for mutton and beef. The agreement does not increase the UK’s cheese quotas, state broadcaster NRK have reported. 

The agreement will still need to be signed by both the Norwegian and UK parliament. 

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