Germany rebalancing: Waiting for Godot?

Germany’s current account surplus hit a record 7.5 per cent of GDP in 2014. Neither Germany nor its trade partners benefit from this. The current account balance is simply the difference between a country’s income and what it spends. For the average German, the surplus therefore represents lower consumption than otherwise would have been the case and worse infrastructure and public services. Since Germany saves so much, it invests huge sums of money abroad, with disastrous results. The country has lost almost a third of the savings (almost €600 billion) that it has invested in other countries since 1999; this money could have been invested more productively at home. Moreover, Germany’s surplus is a formidable obstacle to a eurozone recovery. Rebalancing would boost the eurozone economy by raising inflation and making it easier for other eurozone countries to service their debts, including those debts owed to Germany