Pay restraint put Germany back on track but at a cost. It has left the economy more unbalanced than ever. Exports are super-competitive. In last year’s annual health-check, the IMF said Germany’s real effective exchange rate was undervalued by 10-20%. Consumer spending, meanwhile, remains depressed. Despite abundant jobs growth, the share of GDP going to households has fallen from 65% in the early 1990s to 60% or below, to the benefit of corporate profits (see chart 4). The rate of household saving, however, has not changed much: it is currently 9.8%, exactly in line with its 20-year average.
Archives For international business
I figure I would link to this article because its in my market specialization and I have no posted much business related news on my site thus far. A lot of companies might have some apprehensions when dealing with Chinese manufacturing especially due to the cultural and language differences. Enjoy.