August 10, 2018 / 8:54 AM / 4 months ago

Germany maintains large surplus with U.S. despite trade friction

FILE PHOTO: German Chancellor Angela Merkel listens to Chairman of Volkswagen Passenger Cars Herbert Diess as she sits in Volkswagen Tiguan during her opening tour of the Frankfurt Motor Show (IAA) in Frankfurt, September 17, 2015. REUTERS/Kai Pfaffenbach/File Photo

BERLIN (Reuters) - Germany’s exports to the United States in the first half of this year were worth 24.4 billion euros (£22.19 billion) more than its imports of U.S. goods, data from the Federal Statistics Office showed on Friday.

The trade surplus was 100 million euros less than last year, but still meant Germany has the largest trade surplus with the United States than any other country, something U.S. President Donald Trump has vowed to reverse.

Germany’s trade surplus has also come under attack from the International Monetary Fund, which says it contributes to trade tensions and adds to risks that could undermine global financial stability.

Germany’s trade surplus with the whole world was 121.5 billion euros in the first half, slightly higher that last year.

The IMF has urged the German government to boost investments beyond the levels agreed by Chancellor Angela Merkel’s government which plans to increase spending by 4 percent this year. Higher government spending would stimulate imports.

Trump hit the European Union, Canada and Mexico with tariffs of 25 percent on steel and 10 percent on aluminium at the start of June, ending exemptions that had been in place since March. The EU and Canada responded with their own levies on U.S. goods.

China imposed tariffs on U.S. goods in response to Trump’s levies on Chinese imports, spooking German manufacturers who rely on the world’s two largest economies for growth.

Fears of an all-out trade war between the U.S. and the European Union eased after Trump agreed last month to refrain from imposing tariffs on cars imported from the bloc while the two sides negotiate cuts to other trade barriers.

Germany’s exports to the United States - its biggest export market - rose 0.8 percent to 56.1 billion euros in the first six months of the year. France was the second-largest importer of German goods, followed by the Netherlands.

Writing by Joseph Nasr; Editing by Robin Pomeroy

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