Germany's current account surplus is set to remain the world's largest this year despite increased trade tensions, the Ifo institute said on Monday, in an estimate likely to renew criticism of Chancellor Angela Merkel's fiscal policies.
The International Monetary Fund and the European Commission have for years urged Germany to do more to lift domestic demand and imports as a way to reduce global economic imbalances and stimulate growth elsewhere. Since his election, U.S. President Donald Trump has also criticised Germany's export strength.
Germany's current account surplus — which measures the flow of goods, services and investments — will remain the world's largest for the third year running in 2018 at $299 billion, followed by Japan with $200 billion, according to Ifo estimates.
The Netherlands are likely to come in third with a current account surplus of roughly 110 billion dollars while China will not be among the top three surplus countries due to a surge in imports and lower returns from capital held abroad, Ifo said.
“On the other end of the spectrum, the United States is set to remain the country with the largest current account deficit with roughly 420 billion euros,” Ifo economist Christian Grimme said.