Germany Energy and Environment


Germany is the fourth largest economy in the world and the first in Europe. The manufacturing industry and related services are the basis of the economy, although they do not represent the majority share in the composition of the GDP. The main products include industrial machinery, motor vehicles, chemical processing and steel, while the proportion of high-tech goods is less significant than in other industrialized countries, such as Switzerland or France (exports of these goods in Germany amount to 16% of total).

Agriculture accounts for only 0.8% of GDP, but the sector plays an important role in the German social fabric. Services represent the majority share of GDP (around 69%) and the banking sector is among the most important, together with retail trade and tourism. From 2003 to 2008, Germany was the world’s leading exporter, then overtaken by China in 2009; the downsizing of foreign demand, the strengthening of the economies of Eastern European countries and the growth in demand in Asia contributed to this result. At the same time, the eastern markets have rapidly become a land of conquest for German exports: in 2014 Germany identified China, Indonesia and South Korea as the most strategically relevant markets for the future of German exports, together in the United Kingdom, Colombia and Ghana. To date, the strength of German exports is evidenced by the huge surplus in the trade balance, equal to 287,300 million dollars in 2014, or approximately 8.4% of GDP.. The main exported products are cars, aircraft, machinery, chemicals, food and refined fuels. The majority of the flow rate is currently still directed towards the countries of ‘ Eu (about 67%), in particular in France, Netherlands, United Kingdom and Italy.

However, the level of overall economic activity is still modest and in 2015 the German economy – which in any case proves to be among the strongest in the eurozone – grew by 1.6%. The high degree of openness and integration with the world system, associated with the size of the German economy, ensures that reciprocal influences are strong: if the US and European crises have had a negative impact on German growth, on the other hand the German crisis has had an impact negative on the economy of Eastern European countries, which export a lot to Germany. To respond to the complexity of the situation, regulate the financial sector and ensure a fairer distribution of costs and risks, in November 2010 Germany passed a law to reorganize and restructure credit institutions, in some cases limiting their investment activities.

In 2015, the debt-to- GDP ratio fell to 69.5%, five percentage points less than in 2014: the forecasts point to a reduction to 61.5% by 2019. This puts Germany fully in line with the parameters of Maastricht, which predict a debt / GDP ratio of 60% by 2023. Despite the efficiency of public finances, the overall image of the German production system was partly undermined in September 2015 by the serious scandal involving the car manufacturer Volkswagen: an event that could have serious repercussions on the global automotive market.

Energy and environment

Germany is one of the largest energy markets in Europe and therefore has a strong impact on European and global policy in this area. It currently produces energy with coal, gas, renewable energy and nuclear power. However, it imports about two thirds of the energy consumed, in particular oil, which accounts for 33.2% of total consumption, and gas (21.1% of total consumption). In 2011, the Nord Stream gas pipeline came into operation which, across the Baltic Sea, connects Russia to Germany and the European distribution system, with an initial transportation capacity of 27.5 billion cubic meters of gas. The dependence on Russia has become the central theme of the energy debate in Germany: the outbreak of the Ukrainian crisis and the rupture of relations with Putin’s Russia – with the consequent economic sanctions imposed by the EU – in fact lead to fears of Moscow’s retaliation in this sector, where Berlin it is more exposed.

The other major topic of discussion in energy policy concerns the use of nuclear power. Currently, Germany produces 8.3% of the energy consumed with nuclear power, a percentage more or less halved compared to a decade ago since, in the early 2000s, coalition governments formed by SPDand Verdi, in concert with the energy industry, promoted a program for the phasing out of nuclear power by 2020. Following the Fukushima disaster in Japan and the greater weight obtained on the political scene by the Greens, thanks to the result of the elections administrative of 2011, Chancellor Merkel gave a decisive push to this program, announcing the total abandonment of nuclear power by 2022. The challenge of the German government would therefore become that of significantly increasing the production of renewable energy and energy efficiency. However, the abandonment of nuclear power is translating, at least in the short to medium term, into the need to increase the use of coal (the most polluting of fossil fuels).

Since the plan for the gradual closure of the country’s atomic reactors was launched, the consumption of coal has increased significantly and its component in the total energy mix is ​​rapidly approaching 30%: a very high value for a European country (the United United, for example, uses coal to produce about 16.8% of its energy needs), which has significant consequences in terms of environmental impact, especially considering that Germany is the largest consumer of energy in Europe (excluding Russia). The choice to reduce nuclear power also has implications for the future of German energy politics and dependence, since it could increase Germany’s dependence on imports from Russia, but also from France, for nuclear power. That said, environmental policy: it consists in making renewables a cornerstone of energy production by 2050. The latter accounted for 12.6% of energy production in 2012 compared to 3.4% in 2000. In recent years, substantial funding has been offered to the sector – developing biomass and wind power in particular – in order to reach the 35% target by 2020.

Germany Environment