(...)since Germany’s reunification in 1990, German trade has become increasingly less dependent on the rest of the eurozone. In 1991, what is now the euro area absorbed 51.3 per cent of total German exports. This fell to 45.1 per cent in 1998, just before the euro’s launch. It went down again to 43.7 per cent in 2007.
German trade is less and less integrated with the rest of the eurozone in terms of imports, too. Contrary to popular myth, the volume of imports of goods and services has expanded far more in Germany (48.1 per cent) than in France (39.5 per cent) since the euro’s debut in 1999. But Germany is increasingly buying its imports from countries outside the euro area.
The obvious conclusion is that German businesses see ever more promising opportunities in trading with China, other Asian countries and the US than with many of their counterparts in Europe. Why should this be so? It comes down to the cost of rebuilding eastern Germany after reunification and the loss of competitiveness that this astronomical financial burden inflicted on German companies. They regained international competitiveness partly by grinding down domestic labour costs, but also by turning to cheap non-European suppliers for their inputs.
This reality shows that the economies of the eurozone are very different and that those reasons, countries have therefore not only different interests, but also different objectives when it comes to the euro. The fact that Germany is less integrated in the Eurozone matters not only because it is its most populous country and its strongest economy, but also because it means that the Germans more than others cannot afford the euro to become weak even if it may help the group. In short, if the Greece crisis isn't solved and if there is any type of contagion, there is going to be more tensions between Germany and the others and more importantly a discussion about the reduction of the size of the eurozone to protect the euro.