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In some countries, a sizable fraction of savings is derived from corporate savings. Although larger, traded corporations are often co-owned by foreign portfolio investors, current international accounting standards allocate all corporate savings to the host country. This paper suggests a framework to correct for this misleading attribution and applies this concept to Germany. For the years 2012 to 2020, our corrections retrospectively reduce German savings and consequently the German current account surplus by, on average, €11.5bn annually. This amounts to lowering Germany’s average official current account surplus (€226.6bn) across these years by approximately five percent.

In some countries, a sizable fraction of savings is derived from corporate savings. Although larger, traded corporations are often co-owned by foreign portfolio investors, current international accounting standards allocate all corporate savings to the host country. This paper suggests a framework to correct for this misleading attribution and applies this concept to Germany. For the years 2012 to 2020, our corrections retrospectively reduce German savings and consequently the German current account surplus by, on average, €11.5bn annually. This amounts to lowering Germany’s average official current account surplus (€226.6bn) across these years by approximately five percent.

In some countries, a sizable fraction of savings is derived from corporate savings. Although larger, traded corporations are often co-owned by foreign portfolio investors, current international accounting standards allocate all corporate savings to the host country. This paper suggests a framework to correct for this misleading attribution and applies this concept to Germany. For the years 2012 to 2020, our corrections retrospectively reduce German savings and consequently the German current account surplus by, on average, €11.5bn annually. This amounts to approximately five percent of Germany’s average official current account surplus (€226.6bn) across these years.

Der vorliegende Diskussionsbeitrag entstand im Rahmen eines Forschungsprojektes über die monetäre Integration von fünf mittel- und osteuropäischen EU-Beitrittskandidaten (Polen, Tschechische Republik, Ungarn, Slowenien und Estland). Das hier vorgestellte Kapitel geht auf die währungspolitischen Interdependenzen in der Region ein und zieht daraus Schlüsse für ein geeignetes Wechselkurssystem der genannten Länder. Dabei erweisen sich die Wechselkurselastizitäten des Sozialproduktes, die Korrelation exogener Schocks und die Priorität monetärer bzw. realer Ziele als die entscheidenden Variablen. In der gegenwärtigen Situation überwiegen die Nachteile fester Wechselkurse, die aus einer verminderten Reaktionsfähigkeit auf exogene Schocks beruhen, die Vorteile einer verringerten Wechselkursvolatilität. Der intensive Wettbewerb innerhalb Mittel- und Osteuropas (MOE) um Exporte in die EU und eine wachsende Bedeutung stabiler Wechselkurse gegenüber dem Euro könnten in der Zukunft allerdings einen gemeinsamen Übergang zu festen Wechselkursen sinnvoll erscheinen lassen. Gleichwohl bleibt ein generelles Fixkursregime einer währungspolitischen Koordination, etwa in Gestalt einer Schlange im Tunnel, in jedem Fall unterlegen., This paper is part of a research project on monetary integration of five EU-accession candidates (Poland, Czech Republic, Hungary, Slovenia and Estonia). The chapter presented here focuses on monetary policy interdependencies in the region and draws some conclusions on the adequate exchange rate regimes in Central and Eastern Europe (CEE). The exchange rate elasticities of output, the correlation of exogenous shocks and the priority of monetary or real targets turn out to be the decisive variables. At the present, the social costs of fixed exchange rates due to a reduced absorption of exogenous shocks outweigh the possible gains, which result from reduced exchange rate volatility. However, the strong competition of the selected countries for exports in the EU and a rising importance of stable exchange rates vis-à-vis the Euro may give an argument for a common switch to fixed exchange rates in the future. Nevertheless, it is argued that fixed exchange rates will always be inferior to monetary coordination in CEE, e.g. in the form of a snake in the tunnel.