If you dream of a more national economy, where the Germans determine everything themselves, the Corona crisis is putting the brakes on you. While stores had to close and citizens raised money, it was exports that pulled the country out of the crisis. German companies are even selling more goods abroad than before the pandemic. This export force works like a life insurance policy against mass unemployment. You should keep them in mind when discussing the sovereignty of production, vaccinations, and global competition.
When the pandemic broke out, some drew the opposite conclusion: the Federal Republic should renationalise itself. Possible bottlenecks in medical products have served as a reason for generally relocating production within the country – and perhaps for building walls against imports to protect domestic factories. Such mind games tend to forget what the consequence would be: the former trading partners would buy much less goods from the Federal Republic. German competitive advantages for some products are less likely to translate into high profits and wages. Lisandra Flach of the Ifo Institute calculates that economic output would decline by ten percent if it were to be relocated.
Yes, Germany must ensure that the selected life-saving products are in sufficient stock – or that they can be obtained quickly. However, a general strategy of self-sufficiency costs too much. The industry’s current supply problems offer just as little reason to upset everything, as much as they are boring in the recovery of the Corona Valley. Of course, it is questionable whether too much chip production has migrated from Europe – and industrial policy efforts are worth it in order to secure know-how and well-paying jobs with this important technology. As a pure remedy for current supply problems, however, these considerations are not appropriate, they would come too late anyway.
Only one in ten German companies will rely more on national supply chains in the future, according to a new Ifo study. Others prefer to increase stocks or the number of suppliers. It seems like a sensible strategy to avoid future delivery bottlenecks without sacrificing the benefits of international trade.
Looking less at the national navel also applies to another challenge. As more and more citizens in industrialized countries are vaccinated against Corona, the rest of the world is lagging behind. Also emerging countries like India or Brazil, which are important sales markets for German companies.
In purely humanitarian terms, it is imperative to provide vaccines to the world’s poorest majority. But if that doesn’t make sense to you in your national narrow-mindedness, it must be said that there are additional economic arguments. Industrialized countries should spend a lot of money to get everyone vaccinated as soon as possible. It seems obvious. But it is far from being when a party like the AfD competes for the voters with the slogan that it is better to start in Germany instead of saving the world.
It is also worth looking at a historic struggle that threatens German exports from afar. The United States and China continue to be caught in a titanic battle for political, economic and technological leadership under new President Joe Biden. They see Europe as a tool to assert their interests. There are still scenarios in the room that European companies should decide whether to deliver to the United States or China.
The correct answer would be more self-esteem. As an economic space, Europe is important enough not to be jostled. To make the self-proclaimed titans understand this, two things are needed: massive investments by companies and states instead of false frugality so that Europe does not fall behind in technology. And after the departure of Angela Merkel, another chancellor of international stature.