The eurozone’s goods trade surplus is under structural threat in World Economy News 24/04/2026 The eurozone growth model, built on competitive exports of goods and access to cheap inputs, is under structural pressure. The energy price shocks, increased Chinese competitiveness, and the changing role of the US in the world economy work against the exceptionally high trade surplus that the eurozone has had since the global financial crisis. The Middle East war is likely to weaken the trade balance in the short run. But the problem is also a structural one, as European companies are facing stronger global competition, particularly from China, which has made rapid advances in several key sectors. Export growth is therefore becoming a less important engine of the economy, which affects the growth outlook. How the eurozone growth model is being reshaped The eurozone’s economic model was reshaped after the global financial crisis of 2008 and the subsequent euro crisis. Pre-2008, Germany ran large trade surpluses, which were counterbalanced by the trade deficits of countries in the south. When the euro crisis forced southern European countries to tighten their belts, their trade deficits disappeared. The policy response to the euro crisis always implicitly aimed to impose the German economic model on the rest of Europe. And, at least for a while, it succeeded. Most of the eurozone effectively became more ‘German’; i.e. wage growth was more subdued, imports were modest and exports strengthened. This resulted in a trade surplus of around €50bn per quarter for the eurozone as a whole in the late 2010s. But this decade, the goods surplus has come under pressure. This is mainly due to more expensive energy, but the eurozone’s competitive position has also weakened due to higher wages and increased external competition. Services trade has been less affected so far, but the impact on goods trade can be significant. For the years ahead, we see more downside for the goods trade balance as increased defence spending will likely boost imports, the competitive position of China continues to show strength, and energy dependence remains a weak spot for the eurozone. The war in Iran adds renewed pressures on the eurozone trade balance That steady, strong trade surplus of the 2010s was interrupted abruptly by the energy shock of 2021/22. While the eurozone had always been a net importer of energy, the dramatic reduction of Russian gas supply pushed energy costs sharply higher, dragging the total trade balance into a deficit. Since then, it has diversified away from cheap Russian energy, but towards pricier alternatives, which has kept pressure on the trade balance. Overall, the eurozone goods trade surplus still remains almost 30% lower than in 2019. Renewed tensions linked to the oil shortages arising from the war in the Middle East will put the eurozone’s trade surplus under pressure again this year. To illustrate this, let’s assume that goods trade volumes remain unchanged from 2025. Focusing only on the first‑round effects of higher energy import prices, the trade balance could fall sharply to €49bn in 2026, from €149bn in 2025. This scenario assumes our base case, in which disruptions at the Strait of Hormuz continue until July but ease gradually. In a more pessimistic scenario where the disruptions are stronger and continue until August, the eurozone’s trade balance risks falling into a significant deficit again at -€115bn in 2026. Clearly, the eurozone’s