Another escalation of the customs dispute seems to averted the agreement between the EU and the USA for the time being. However, business representatives are by no means enthusiastic, experts warn of enormous consequences.
In addition to slight relaxation, the agreement between the European Union and the United States has triggered critical reactions in the economy. The compromise announced by EU Commission President Ursula von der Leyen and US President Donald Trump “has a deep breath,” said the general manager of the German Chamber of Commerce and Industry (DIHK), Helena Melnikov. However, the deal has its price, “and this price is also at the expense of the German and European economy”.
The EU and the United States had previously agreed on a fundamental agreement to defuse the customs conflict that has been going on for months. According to Leyen, the customs set to most European imports to the United States will be 15 percent, which also applies to cars, semiconductor and pharmaceutical products. According to the US President, the tariffs on the import of steel and aluminum remain 50 percent.
“Stability in the short term, nothing more”
“For many companies, this is an urgently needed breathing space,” said Dihk boss Melnikov. The EU prevented worse things with the agreement, even if many details remained unclear. “The agreement creates stability at short notice, nothing more. It is just a first step.” The EU must now continue to negotiate with the United States “and work on a comprehensive, fair and future -oriented trade agreement”.
Despite the agreement, the Federal Government and the EU Commission are required to “draw the right conclusions: We need competitive location conditions, reliable politics, targeted investment incentives and, above all, more speed and other free trade agreements,” said Melnikov. The Mercosur Agreement must finally be ratified, the negotiations with India, Indonesia and Australia have to be continued.
Too many concessions in Europe?
The BDI industrial association was much more critical of the trade deal. He sends a fatal signal in which the EU accepts painful tariffs, says BDI expert Wolfgang Niedermark. “Because even a 15 percent duty will have immense negative effects on export -oriented German industry.”
The BDI also criticized the further high tariffs on steel and aluminum. That is an additional deep blow. “This continues to put pressure on a key industry, which is already with enormous challenges in international competition and through the transformation,” said Niedermark. The EU must now show that it is more than an internal market. “We need a strategy for a competitive and resilient economy as well as the political will to play confidently in global power structure.”
At least it is positive that another escalation spiral was initially averted. “It is now crucial that the closed agreement becomes binding.”
OuterEnhandelsverband: Every percent inch is too much
The general manager of the Chemical Association VCI, Wolfgang Große Entrup, said: “Anyone who expects a hurricane is grateful for a storm.” Even if another escalation has been avoided: Europe’s exports are less competitive with the deal, the agreed tariffs are too high from the perspective of chemistry.
The German Foreign Trade Association called the customs cleaning with the United States a “painful compromise”. Every percent inch is one percent too much, explained the President of the BGA industry association, Dirk Jandura. “For many of our dealers, the customs surcharge means an existential threat.”
Even if there is now security over the trade conditions, supply chains would change and increase prices. “The agreement with the USA will have a noticeable impact here in the country. It will cost growth, prosperity and jobs.”
Economist warns of “enormous Loss of wealth “
The financial market economist Ulrike Malmendier warned in an interview Tagesschau24 Before the consequences of the compromise for the economy and consumers in the European Union. The now agreed tariffs of 15 percent are likely to lead to an “enormous loss of wealth”, according to the expert. “And the sad thing is that this will no longer go away for the foreseeable future. Because if such tariffs are levied, it will be difficult to get it down again.”
Interestingly, experts assumed that the consequences should be particularly noticeable in the United States, said Malmendier. It is expected that growth in gross domestic product (GDP) could be around 1.5 percent lower. For the EU, the consequences of GDP should only be half as bad. However, it should be emphasized that there are great uncertainties and variance in these calculations, because it is not foreseeable, for example, how long these tariffs will now be in force.
Ulrike Malmendier, financial market economist, the result of the customs negotiations between the EU and the USA
IW director: Trump’s customs threat not from the table
The director of the Institute of German Economy (IW), Michael Hüther, warned of further faults from Washington. “You can’t trust that there is now peace,” he told the newspapers of the Funke media group. “Trump never completely takes off the customs threat.” This is also why a more powerful EU negotiating strategy would have been useful.
The President of the Kiel Institute for World Economy (IFW), Moritz Schularick, wrote on X: “The short -term economic costs of the deal with Trump are manageable for Germany and EU, but there is no reason to celebrate this trading appeasement.” The higher costs would come later, according to Schularick.
The IFW President also warned of the course changes of the US president: “Instead of defending the rule-based world trade regulations, the EU encourages a deal that is unsure of how long it lasts, which is ruled by the moods of a populist and not by the right and which is hardly compatible with the rules of the world trade organization.”
