The euro area economy is relatively open, particularly when compared with other major economies, including the United States, China and Japan. Moreover, the trade openness of the euro area has increased noticeably since 1998, particularly as a result of growing trade with new EU Member States and China. In 2012, extra-euro area exports and imports of goods accounted for almost 39% of euro area GDP, up from 25% in 1999. Yet, the euro area is far less open than the economies of the individual euro area countries.
Trade in goods accounts for about three-quarters of euro area imports and exports. Comparing the sectoral composition of extra-euro area exports and imports, imports tend to have a larger share of energy and raw materials, while exports tend to be more heavily focused on processed goods. This reflects the international division of labour and the scarcity of raw materials in the euro area. Trade in services is around one quarter of total trade and the sectoral breakdown is rather similar for exports and imports. The largest share is taken up by business services, followed by transportation and travel services.
|External trade in goods of the euro area in 2012
(share of total as a percentage)
|Sources: Eurostat and ECB calculations.|
|Machinery and transport equipment||41.1||28.0|
|Other manufactured articles||23.7||22.6|
|Food, drink and tobacco||7.0||6.1|
|External trade in services of the euro area in 2012
(share of total as a percentage)
|Sources: ECB calculations.|
|Other business services||30.8||31.4|
|Computer and information services||7.9||3.9|
|Royalties and licence fees||5.7||9.1|
|Personal, cultural and recreational services||1.2||1.4|
The non-euro area EU Member States and the top 10 trading partners outside the EU together account for about three-quarters of euro area trade. Among individual countries, the United Kingdom, the United States and China are the three largest trading partners of the euro area. However, the non-euro area EU Member States together also account for a significant share of euro area trade.
|Export and import shares of the euro area's main trading partners
|Source: ECB calculations are based on Eurostat trade data.
Notes: Countries are ranked according to 2008-2012 export weights. Countries listed in the table represent around three-quarters of euro area trade.
|2003 - 2007||2008 - 2012|
|Non-EU trading partners||38.13||42.41||39.58||43.52|
|United Arab Emirates||1.26||0.34||1.46||0.32|
The nominal effective exchange rate (EER) is a geometric weighted average of the bilateral exchange rates of the euro against the currencies of a selection of trading partners. The real EER takes into account developments in relative prices between the euro area and its trading partners. It is calculated on the basis of consumer price indices, producer price indices, GDP deflators and unit labour cost indices - the latter for the total economy as well as for the manufacturing sector. It provides a measure of international cost and price competitiveness of the euro area. Nominal and real EER indices are currently computed against:
The EERs are constructed using moving weights, calculated on the basis of shares in euro area external trade in manufactured goods. The scheme combines information on exports and imports and accounts for so-called third-market effects, i.e. competition faced by euro area exporters in a partner country from exporters of a third country. The weighting schemes for the EERs are calculated on the basis of trade data referring to five periods: averages of 1995-1997 are used in the construction of the series up to 1997; data for the periods 1998-2000, 2001-2003 and 2004-2006 are used in the corresponding periods and weights based on data for 2007-2009 are used in the calculation of the series from 2007 onwards (see Box 1 in March 2012 ECB Monthly Bulletin). Developments in the EER-21 set of indices are regularly commented in the ECB Monthly Bulletin.
|Trade weights used in the calculation of the EERs of the euro (adjusted for third market effects)
(2007-2009, percentage points)
Background information on the calculation of the effective exchange rates:
For more detailed information on the evolution of the trade weights over time, see the Statistics section: Background on the daily nominal effective exchange rate of the euro.