Thanks to SME Germany is less sensitive to high oil prices

An article by the FrankfurterAllgemeineZeitung (FAZ) demonstrates an interesting connection: The German industry is profiting from high oil prices due to a backflow of petrodollars from the oil-producing countries buying high-quality technology and equipment in Germany.

Being export world champion Germany is particularly benefiting from this cycle, says the article´s author, Mr. Gerald Braunberger. Although more industrialized than other wealthy countries and therefore more dependent on oil prices, the fact that a big part of its industry is made up of small and medium-sized enterprises (SME) was to Germany´s advantage. This is because these very SME manufacture the high-quality products which are sought-after by the oil-producing countries, such as mining and conveyor systems. According to the author it is a well-known phenomenon that countries being rich in raw materials often suffer from the »Dutch desease« (⇒ Wikipedia) and, except for their raw materials branch, neglect other fields of industry. From this situation follows a backflow of petroldollars into industrialized countries and in particular into Germany which are compensating for part of the big burdens due to high oil prices. GERMAN