In the third quarter of 2021, euro area exports increased 1.2% quarter-on-quarter, while imports climbed 0.7%, contributing 0.3 percentage points to GDP growth.

Although net trade contributed positively to GDP growth in the third quarter, goods exports were held back by continued supply disruptions, according to the European Central Bank (ECB).

Trade in goods and services had divergent results. The region’s exports and imports of goods declined (by 1.0 and 0.9%, respectively, quarter-over-quarter) as global demand moderated and supply disruptions persisted.

On the contrary, exports and imports of services expanded strongly (7.3 and 5.9%, respectively, quarter-over-quarter), driven by double-digit growth rates in countries that are summer tourist destinations.

Looking ahead, order-based indicators for goods exports point to a moderation in demand.

In addition, the renewed escalation of the pandemic threatens the recovery of services exports, particularly travel-related services.

Passenger and flight data shows a slowdown in recovery from September 2021, while forward-looking indicators based on orders and expectations point to a slowdown in momentum in the coming months.

Euro zone exports

Despite short-term uncertainties, activity in the euro area is expected to exceed pre-crisis levels in the course of 2022.

The medium-term prospects foresee a further strengthening of domestic demand along with an improvement in the labor market and a strengthening of global growth as shocks diminish in the short term, as well as continued support from both monetary and fiscal policy in the transition to self-sufficient growth.

Furthermore, according to the ECB, progress in the implementation of the Next Generation EU program is an additional factor helping to support the recovery.