Resume af teksten:
Eurozonen står over for øget volatilitet i handelsbalancen for varer med et faldende gennemsnitligt overskud. Den økonomiske model, som hidtil har været afhængig af konkurrencedygtige eksportvarer og billige input, er under strukturel pres. Energiomkostninger og stærkere global konkurrence har forringet eurozonens konkurrenceposition. Handelsoverskuddet er faldet næsten 30% siden 2019. Strukturelle risikoer inkluderer stigende konkurrence fra Kina, hvor importen er steget markant. Eurozonens kernesektorer som maskiner, transportudstyr og kemikalier står over for konkurrence fra Kina. Eksportvæksten svækkes, hvilket påvirker den generelle økonomiske vækst.
Fra ING:
The eurozone’s trade balance for goods is facing both cyclical and structural pressure. After a long period of large surpluses, volatility is likely to increase and the average surplus is set to decline. While some rebalancing can be healthy, this is more a sign of weakness than strength, as eurozone exports are under pressure
A large container ship arriving at the Maasvlakte harbour in Rotterdam
The eurozone growth model, built on competitive exports of goods and access to cheap inputs, is under structural pressure. The energy price shocks, increased Chinese competitiveness, and the changing role of the US in the world economy work against the exceptionally high trade surplus that the eurozone has had since the global financial crisis.
The Middle East war is likely to weaken the trade balance in the short run. But the problem is also a structural one, as European companies are facing stronger global competition, particularly from China, which has made rapid advances in several key sectors. Export growth is therefore becoming a less important engine of the economy, which affects the growth outlook.
How the eurozone growth model is being reshaped
The eurozone’s economic model was reshaped after the global financial crisis of 2008 and the subsequent euro crisis. Pre-2008, Germany ran large trade surpluses, which were counterbalanced by the trade deficits of countries in the south. When the euro crisis forced southern European countries to tighten their belts, their trade deficits disappeared. The policy response to the euro crisis always implicitly aimed to impose the German economic model on the rest of Europe. And, at least for a while, it succeeded. Most of the eurozone effectively became more ‘German’; i.e. wage growth was more subdued, imports were modest and exports strengthened. This resulted in a trade surplus of around €50bn per quarter for the eurozone as a whole in the late 2010s.
But this decade, the goods surplus has come under pressure. This is mainly due to more expensive energy, but the eurozone’s competitive position has also weakened due to higher wages and increased external competition. Services trade has been less affected so far, but the impact on goods trade can be significant. For the years ahead, we see more downside for the goods trade balance as increased defence spending will likely boost imports, the competitive position of China continues to show strength, and energy dependence remains a weak spot for the eurozone.
The eurozone goods trade balance is structurally lower since the pandemic
Eurozone goods trade balance with partners
Comext, ING Research
The war in Iran adds renewed pressures on the eurozone trade balance
That steady, strong trade surplus of the 2010s was interrupted abruptly by the energy shock of 2021/22. While the eurozone had always been a net importer of energy, the dramatic reduction of Russian gas supply pushed energy costs sharply higher, dragging the total trade balance into a deficit. Since then, it has diversified away from cheap Russian energy, but towards pricier alternatives, which has kept pressure on the trade balance. Overall, the eurozone goods trade surplus still remains almost 30% lower than in 2019.
Renewed tensions linked to the oil shortages arising from the war in the Middle East will put the eurozone’s trade surplus under pressure again this year. To illustrate this, let’s assume that goods trade volumes remain unchanged from 2025. Focusing only on the first‑round effects of higher energy import prices, the trade balance could fall sharply to €49bn in 2026, from €149bn in 2025. This scenario assumes our base case , in which disruptions at the Strait of Hormuz continue until July but ease gradually.
In a more pessimistic scenario where the disruptions are stronger and continue until August, the eurozone’s trade balance risks falling into a significant deficit again at -€115bn in 2026.
Clearly, the eurozone’s dependence on external energy makes it vulnerable to short- and long-term shocks in the energy markets. After a period of very benign geopolitics, the renewed tensions of the 2020s are increasing volatility in the eurozone’s trade balance and, for now, are resulting in a lower average trade surplus.
To President Trump’s delight, the trade surplus with the US is also coming down
Eurozone exports to the US, its top export destination, surged ahead of President Trump’s ‘Liberation Day’ announcement in April 2025. As US firms rushed to frontload goods to avoid elevated tariffs, exports to the US jumped by over 60% year-on-year in March 2025. Medicine and pharmaceuticals made up over 40% of total shipments that month. This was short-lived. In the second half of the year, exports to the US fell by 20% (almost €60bn) compared to the first half, leading to a smaller trade surplus with the US. While some of this lost trade was diverted elsewhere, it was not enough to fully offset the decline.
We are wary about drawing meaningful conclusions on the back of the tariff developments just yet. As things settle, we will see just how much export volume to the US has been permanently lost. We don’t expect the impact to be insignificant, but neither do we expect it to be dramatic. At the same time though, energy imports from the US have increased as the eurozone has reduced its reliance on Russia for gas. And the European Commission has promised a lot more imports to come in the years ahead. With more US LNG export capacity coming online, this adds to the changing trade relationship between the US and eurozone. However, if overall demand for LNG remains the same, these additional US supplies would largely substitute for imports from other countries such as Norway and Qatar.
Yet, the eurozone’s trade rebalancing is increasingly a China story
Energy cost pressures and tariff frictions are creating short‑term stress for eurozone trade. But when it comes to the imbalance with its main trading partners, China stands out.
Increased Chinese competition in the eurozone, and in third markets, has been a trend that restarted with the Covid pandemic, and has been intensifying as Chinese production has moved up the value chain. At the same time, weak domestic demand in China has added to overcapacity, which has contributed to a more aggressive export strategy. We have written extensively about this here .
China has been gaining global share in some high-value sectors
Share in global exports, %
WTO, ING Research
The eurozone has also become more reliant on China over recent years. The share of imported goods from China has risen from 14% to 16% between 2019 and 2025. The growth in imports has been staggering, at 51% over the same period, while exports to China declined by 1%. As a result, the eurozone’s goods trade deficit with China now stands at €156bn more than in 2019.
Eurozone goods trade balance with China is structurally lower since pre-pandemic
Eurozone trade balance with China
Comext, ING Research
The eurozone’s core export industries now face strong Chinese competition
What makes this more concerning is where the pressure is coming from. China’s surge in competitiveness is most apparent in sectors that are the eurozone’s core export sectors: machinery, transport equipment, chemicals and pharmaceuticals. These industries together made up almost 70% of total eurozone exports in 2025. Here, higher energy costs have already eroded competitiveness, especially in Germany.
The strain is most visible in machinery and transport equipment, the eurozone’s largest export category (50% of exports in 2025). Despite increased exports to the US, Turkey and the UK since 2019, the sector’s surplus has shrunk by over €70bn, and much of that deterioration reflects trade with China. The eurozone has moved from being a net exporter of road vehicles to China to a net importer, driven largely by China’s dominance in electric vehicles. Imports of electrical machinery from China have also surged, while eurozone exports have barely moved.
Pharmaceuticals have been a bright spot in eurozone trade. Exports in 2025 were over 80% higher than in 2019, particularly to the US, which were over 150% higher. Imports have increased too but remain lower in value terms overall. Even here, however, Chinese competition is gaining ground. The share of eurozone pharmaceutical imports coming from China has more than doubled from 3% to 8%. Concerns are more pronounced in the chemical sector. Here, the share of eurozone imports of organic chemicals from China surged from 14% to 30% between 2019 and 2025. With the domestic sector suffering from high energy prices, Chinese competition is becoming a structural threat.
Eurozone imports from China are rising in sectors critical to exports
Comext, ING Research
This contributes to a weakening of export growth and downbeat exporters
The mood among eurozone exporters has therefore soured in recent years. With increased competition in the global market, the eurozone export growth model has become harder to sustain. This is not a phenomenon specific to 2025, but a trend that has been building for some time. Businesses’ perceptions of competitiveness inside and outside the eurozone have historically moved in tandem over time, but have seen a clear decoupling since 2022. While firms were already negative about their competitive position within the eurozone, perceptions of competitiveness outside the eurozone have since fallen to all-time lows.
This weakening is also visible in the gross export data. Since 1996, exports have typically outpaced GDP growth during expansions but have also contracted more sharply during downturns. So it is striking that in the current period of expansion, export growth has failed to outpace GDP growth. This suggests that the contribution of exports to overall growth has been steadily diminishing.
The more competitive global environment is translating into weaker eurozone competitiveness
Eurostat, ING Research
Expect a more volatile trade balance with a structurally lower surplus for goods
The benign days of the 2010s, from which the eurozone has profited so much, are over. The rockier 2020s are not beneficial for a trade bloc reliant on others for key inputs and facing more fierce competition.
Looking ahead, the eurozone’s goods trade story goes beyond the short-term dynamics. Energy shocks and tariffs can have transitory impacts on the trade balance. Trade deals with other countries – think of Mercosur, India and Australia – can increase trade flows but with an uncertain impact on the trade balance.
Also, the trade surplus is feeling pressure from the import side. Stronger domestic demand, fuelled by fiscal stimulus, is widely expected to modestly add to growth. This mainly comes from increasing defence spending, which will heavily rely on imports (at least in the early years of increased spending).
But the bigger structural risk is stronger competition from China, which has intensified this decade and is still resulting in increased imports from the eurozone and more limited export opportunities for the eurozone’s largest export sectors. Unless the eurozone regains competitiveness in its core industries, which is not easy to achieve, the days of a strong goods trade surplus supporting economic growth could well be over. While stronger domestic demand can be positive, this seems to be driven more by weakness than strength.
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