Less than four years ago: then Chancellor Angela Merkel and current Chancellor Olaf Scholz with Russian President Vladimir Putin at the G-20 meeting in Osaka. Picture Alliance
Foreign trade between Germany and Russia has completely collapsed. This is shown by the current figures for the full year 2023.
Germany imports from Russia fell by 90 percent. Exports to Russia remained two-thirds below the pre-war level in 2021
This also means that the dream of “change through trade” in relations with Russia has shattered. Our graphic shows how long German politics stuck to it – and how abruptly it ended.
Trade between Germany and Russia collapsed completely in 2023, with the exception of a few remaining items. Germany’s imports from Russia fell by 90 percent. German exports to Russia fell again by 39 percent. Compared to the pre-war year of 2021, they have shrunk by two thirds. This is what data shows Federal office of statistics for German-Russian trade.
Germany only purchased goods worth 3.7 billion euros from Russia in the entire year of 2023. Before Russia’s attack on Ukraine, it was more than 30 billion euros. German companies still delivered goods to Russia worth almost nine billion euros. A large part of this is made up of medicines, medical devices and food. The data from the Federal Statistical Office confirm Business Insider’s own earlier calculations.
The following graphic makes the abrupt collapse clear.
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German trade with Russia: a shattered dream
Germany once had great expectations of trade with Russia. “Change through trade” was the (West) German hope in relation to the Soviet Union. The exchange of goods should open the way for the exchange of ideas. The interweaving of economic benefits should prevent conflicts. Germany bought more and more raw materials in Russia and soon sourced most of its natural gas from Siberia. Russia bought urgently needed machines and equipment from Germany.
But the dream has shattered. Instead of rapprochement, alienation followed. In the conflict over Russia’s aggression against Ukraine, raw materials became a weapon and sanctions became a means of pressure. Even after Russia occupied and then annexed the Ukrainian peninsula of Crimea in 2014, Germany continued to rely on Putin’s cheap raw materials and hardly restricted its exports. The graphic shows this too.
The Nord Stream 2 Baltic Sea pipeline is an example of this. For years, Ukraine and Poland had warned Germany about the German-Russian project, and the USA had even threatened sanctions. But Germany steadfastly relied on trade and the supposed economic advantage.
Went to Russia via a detour
Then in February 2022 there was a rude awakening. Russia invaded Ukraine. Germany, along with the EU, the USA and other countries, imposed sanctions. Germany’s exports to Russia collapsed. In contrast, Germany’s spending on imports from Russia rose again to a record high in 2022 – driven by extreme energy prices. In terms of quantity, they were already shrinking because Putin stopped gas deliveries to Germany on September 1, 2022.
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Compared to the pre-war year of 2021, the overall volume in German-Russian trade has now collapsed by almost 80 percent. Russia is now completely insignificant for German foreign trade. The economic links have largely been resolved. Before the Ukraine war, Russia was the fifth most important market for German exporters outside the EU – just behind economies such as the USA or China. It is now ranked 20th, about the size of Lithuania.
It is also noteworthy that Germany suddenly achieved an export surplus in trade with Russia. In 2023 that was more than five billion euros. But this is no longer of any importance given the total German foreign trade surplus of around 200 billion euros last year.
In December, German companies delivered goods worth 700 million euros to Russia. From there, goods worth 200 million euros came to Germany. At this remaining stock level, the values are now roughly stable.
But something else is important: Parallel to the decline in direct German trade with Russia, Germany has significantly increased its exports to Russia’s neighboring countries, in some cases multiplying them. It makes sense to suspect that this is also an attempt to circumvent sanctions. German vehicles, machines and parts find their way to Russia via Armenia or Azerbaijan.
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German export surplus will rise to 209 billion euros in 2023 – foreign trade is chasing old records again despite all the crises