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UPDATE 2-German exports fall for fifth month in Feb

Published 04/08/2009, 05:46 AM
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(Recasts, adds details)

By Brian Rohan

BERLIN, April 8 (Reuters) - German exports fell for a fifth month running in February, and imports slumped, signalling the economic downturn likely worsened for the world's largest exporter in the first quarter of 2009.

Exports fell 0.7 percent on the month, preliminary Federal Statistics Office data showed on Wednesday. Revised data also showed a 7.4-percent fall in January -- much steeper than the originally reported 4.4 percent drop.

"Global trade has really caved in in recent months," said economist Juergen Michels at Citigroup.

"It looks as though the (German) recession got worse in the first quarter. The economy should have contracted by around 2.5 percent -- due to the slump in exports and investment."

The data meshed with figures from neighbouring France, where both imports and exports were sharply down on the year.

Europe's largest economy enjoyed robust foreign demand for its engineering products until the economic downturn took hold last year and sent the export-orientated economy sharply into reverse.

Last month the BGA trade association forecast German exports will fall by up to 15 percent this year.

Hamburg-based logistics company HHLA said last week it saw 2009 container shipping volumes declining sharply on routes between Asia and Europe as well as to and from the Baltic region.

"For the first time since the container was introduced more than 40 years ago, the global container handling volume appears likely to decrease," said HHLA, which ships containers in and out of Hamburg, Europe's second-biggest port.

Germany's economy shrank 2.1 percent in the final quarter of 2008 and Commerzbank has forecast a contraction of 6-7 percent this year -- though that is easily the gloomiest outlook of any leading bank or think tank.

Finance Minister Peer Steinbrueck has also said the government cannot stand by a forecast for a contraction of only 2.25 percent this year. Since World War Two, the economy has never contracted by more than one percent in a single year.

Imports fell in February by a steeper-than-forecast 4.2 percent in seasonally adjusted terms, outpacing the fall in exports and leading to a trade surplus of 8.9 billion euros ($11.7 billion) for the month.

The dip in exports was the smallest since exports started falling in October, and down from a double-digit drop reported in November, but analysts found little comfort in that.

"Hope remains that we are in a bottoming out phase," said Sebastian Wanke from Dekabank.

"But if you consider the January data, things look almost as bad as economic forecasters fear."

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