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MODERATE RECOVERY IN SIGHT FOR EASTERN GERMANY'S EXPORT SECTOR

 MODERATE RECOVERY IN SIGHT FOR EASTERN GERMANY'S EXPORT SECTOR
 FRANKFURT, Germany, April 9 /PRNewswire/ -- Led by new production financed by western investment, eastern Germany's export industries should see a moderate recovery in 1992 after sharp declines over the past two years, writes Deutsche Bank Research in its latest issue of Focus Germany.
 East German exports fell from approximately $23 billion in 1990 to about $11 billion in 1991, writes DB Research, and well over 50 percent since 1989. As a share of total German exports, east German exports fell from 3.8 percent in 1990 to 2.8 percent in 1991.
 Despite this decline, the volume of east German exports to the EC actually increased, reflecting new trade and production patterns, according to the recently established research subsidiary of Deutsche Bank. At DM 3 billion in 1991, the volume of exports to the EC rose 1.6 percent over 1990. East German exports to the EC as a share of total exports have almost doubled, from 8.5 percent in 1989 to 16.7 percent in 1991. Similarly, because exports to the western industrialized countries declined more slowly than to the former Comecon member states, the share of all east German exports going to the west also nearly doubled.
 Total east German exports to the former Comecon countries dropped by some 60 percent -- by over 80 percent to Hungary alone. Nevertheless, Deutsche Bank Research argues, "east German firms have an edge on other western competitors in trade with the potentially most important market in the East -- Russia and other member states of the CIS. They have people who speak Russian and are versed in the way Russians do business."
 Accounting for 55 percent of all exports in 1991, the CIS was still the single largest importer of east German products, largely due to generous export guarantees from the German government. As late as October 1990, nearly 500,000 east German workers were employed exclusively in production of exports to the Soviet Union. However, exports to the CIS will continue to decline, according to DB Research.
 Overall, the restructuring process reflected in these export patterns should continue in 1992, the research institute concludes, "since western investors in eastern Germany will increasingly serve foreign markets from plants purchased or newly built in eastern Germany."
 For a copy of the complete text, contact Ute DeFarlo, TransAtlantic Futures, Inc., Washington, 202-462-1222; fax 202-462-1229.
 -0- 4/9/92
 /CONTACT: Rutger Teuscher of Deutsche Bank Research, 011-49-69-7150-4722/ CO: Deutsche Bank Research ST: IN: FIN SU:


DC-SB -- DC014 -- 6726 04/09/92 11:14 EDT
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Date:Apr 9, 1992
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