Chinese Product Advantages Versus Germany

Below are the top 10 goods for which China enjoyed a higher dollar value from its exports to Germany after subtracting what it spent on German imports for those same types of products. Technically, a country’s exports minus imports is known as “net exports” which can be a positive amount (indicating a surplus) or a negative number (indicating a deficit).

1. Computers, optical readers: US$8.5 billion surplus win for China
2. Phone system devices: $2.8 billion
3. Lamps, lighting, illuminated signs: $1.8 billion
4. Jerseys, pullovers (knit or crochet): $1.3 billion
5. Footwear (rubber or plastic): $1.2 billion
6. Women’s clothing (not knit or crochet): $1.1 billion
7. Cases, handbags, wallets: $1 billion
8. Electric water heaters, hair dryers: $940.8 million
9. Women’s coats, jackets (not knit or crochet): $934.6 million
10. Seats (excluding barber/dentist chairs): $790.8 million

Among these, footwear (up 43.8%) and phone system devices including smartphones (up 43.6%) increased their net revenues for China from export sales to Germany by the highest percentages from 2012 to 2014.

German Product Advantages Versus China

Sophisticated engineering goods, cars represent the number one export for which Germany shows the strongest sales advantage compared to similar product exports from China to Germany. In second place are automobile parts and accessories that also benefit from strong demand from the blossoming Chinese middle class.

1. Cars: US$16.8 billion surplus win for Germany
2. Automobile parts/accessories: $8.9 billion
3. Aircraft, spacecraft: $3.1 billion
4. Medication mixes in dosage: $2.4 billion
5. Miscellaneous machinery: $2.2 billion
6. Integrated circuits/microassemblies: $1.6 billion
7. Other measuring/testing machines: $1.5 billion
8. Electrical/optical circuit boards, panels: $1.3 billion
9. Rubber/plastic article making machines: $1.3 billion
10. Transmission shafts, gears, clutches: $1.3 billion

The fastest-growing German product win versus China is electrical/optical circuit boards and panels, posting a $1.6 billion surplus up 59.8% compared to an $818.8 million surplus with China during 2012. These German-made components serve as inputs for China’s vast consumer electronics-producing industry.

Germany’s edge over Chinese medication mixes in dosage improved in value by 57.8% from 2012 to 2014.

Final Scorecard for Trade War: China Versus Germany

Spearheaded by complex industrial products, Germany earned an overall $32.3 billion surplus in its international trade with China during 2014.

From a more granular perspective, the Harmonized Tariff Schedule has 97 product categories at the two-digit summary level. Germany held positive balances in 40 of those 97 categories (41.2%) for a $58.4 billion subtotal, led by the following:

1. Vehicles : $25.7 billion surplus win for Germany
2. Machinery: $9.6 billion
3. Optical, technical, medical apparatus: $6 billion
4. Aircraft, spacecraft: $3.6 billion
5. Pharmaceuticals: $3.5 billion
6. Plastics, plastic articles: $1.8 billion
7. Copper: $1.4 billion
8. Other chemical goods: $1 billion
9. Iron, steel: $847.3 million
10. Inorganic chemicals: $681.4 million

These 10 product categories account for 92.7% of the total value of German product-specific surpluses trading with China.

China demonstrated competitive advantages in the remaining 57 product categories subtotaling $26.1 billion in surplus, led by the following:

1. Clothing (not knit or crochet): $4.4 billion surplus win for China
2. Knit or crochet clothing, accessories: $3.9 billion
3. Furniture, lighting , signs: $3.6 billion
4. Footwear: $2.3 billion
5. Toys, games: $1.5 billion
6. Electronic equipment: $1.2 billion
7. Leather, animal gut articles: $1.2 billion
8. Other textiles, worn clothing: $1.2 billion
9. Organic chemicals: $633.8 million
10. Fish: $444.9 million

The above categories represent 78.2% of the total value of German product-specific trade surpluses gained at China’s expense.