Euro area exports fall
Euro area exports fell in September as the region’s economy slipped into a recession for the second time in four years.
Exports from the 17-nation currency bloc declined a seasonally adjusted 1.1 per cent from August, when they gained 3.3 per cent, the European Union's statistics office in Luxembourg said today.
Imports dropped 2.7 per cent and the trade surplus widened to €11.3 billion from a revised €8.9 billion in the previous month.
The sovereign debt crisis in the euro area is taking its toll as governments impose budget cuts to narrow their fiscal deficits.
Gross domestic product in the monetary union fell 0.1 per cent in the third quarter after a 0.2 per cent decline in the previous three months.
Greece’s economy has contracted for 17 straight quarters and the Portuguese economy completed its second year of quarterly contractions.
"The situation for the euro-area economy will get even worse in the fourth quarter and next year," said Jacques Cailloux, chief European economist at Nomura International in London.
"We will see a recession lasting way into 2013 as fiscal consolidation all over the area is hampering demand."
Exports from Germany, Europe's largest economy, slipped 1.5 per cent in September, while imports dropped 2.5 per cent, today's report showed.
Italy and Spain reported export declines of 0.8 per cent and 1.2 per cent, respectively. Shipments from France increased 1.6 per cent in the month.
The European Commission on November 7 forecast that the euro- area economy will contract 0.4 per cent this year and expand 0.1 per cent next year.
It halved its 2013 forecast for growth in Germany to 0.8 per cent, citing the debt crisis and weaker export demand.
Siemens, the biggest engineering company in Europe, on November 8 unveiled a €6 billion savings plan to restore profitability, acknowledging it was slow to react to shrinking demand.
Chief executive officer Peter Loescher said some job losses will be inevitable. Deutsche Post, Europe's largest postal service, said on November 8 that third-quarter profit fell 6.5 per cent as a pay increase caused spending to rise.
"We see as well a slowdown of import and export volumes," chief executive officer Frank Appel.
"The German economy is not as strong as it has been in the past two years."