Challenges in trade relations open up potential benefits with tough trading allies?
In an intriguing article titled "Parlez-vous français? - How Much France is in 'Hambourg'", the focus shifts to the French origins of the city's name. Meanwhile, the Hamburg Institute of International Economics (HWWI), under the guidance of Professor Michael Berlemann, is encouraging the continuation of existing relationships, particularly with key trading partners.
One such partner is the United States, which holds the position as Germany's most important trading partner, with goods worth €252.9 billion exchanged between the two nations in 2024. China, too, plays a significant role in Germany's trade, making Hamburg one of China's most important trading partners, ranking second in imports and fourth in exports.
However, China's dominance in the rare earth market presents a challenge. Extraction outside of China often does not make economic sense, as around 90% of the reserves of these crucial elements for applications in wind power, electric mobility, aerospace, and medical technology are found in China.
Despite these challenges, Professor Berlemann emphasises the importance of seizing opportunities arising from US trade policy. He suggests expanding existing trade relationships and identifying new ones, particularly with potential partners like the Netherlands, Poland, Lithuania, Latvia, and Denmark. Enhanced intra-European trade and cooperation in military and economic sectors may also help reduce dependence on the USA and China.
The Hamburg Foreign Trade Day 2025 is scheduled, promising to delve into these challenges and opportunities further. The event will also highlight the strong connection between Hamburg and Latin America, particularly in the field of trade and future technologies.
A separate celebration, India Week, will also take place, celebrating the relationship between Hamburg and India. This is significant, as research-based pharmaceutical companies in Germany invest more than €9.9 billion in new drugs, and the north is developing key technologies in the life sciences.
It's worth noting that Germany was once known as the 'pharmacy of the world', but pharmaceutical production has since been relocated to Asia, particularly to China. However, the port of Hamburg continues to secure jobs beyond the site, with around 607,000 jobs related to the port, and plays a crucial role in goods distribution for Germany's supply chain and neighboring countries.
Intensifying long-distance trade is good for Hamburg as a port city, and having more international partners makes the location more resilient. By continuing to foster these relationships and seizing opportunities, Hamburg and Germany can navigate the complexities of global trade and maintain their economic strength.
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