While politics struggles with the USA for a trade deal, a study shows the concrete consequences of the customs conflict for the individual industries and regions. The pharmaceutical sector hit it particularly hard.
It is known that an escalation of the customs conflict with the USA has negative consequences for the German economy and in particular certain industries. A current study commissioned by the Familienbetrieb Foundation has calculated various escalation scenarios and quantified the possible losses. The study comes from Gabriel Felbermayr, director of the WIFO research institute in Vienna, and a team from the Kiel Institute for the World Economy.
Export slump by 43 percent
According to this, the pharmaceutical, automotive and mechanical engineering industry would lose a lot of average in the “Customs War” scenario. It was assumed that Trump introduces a flat -rate additional tariffs from 25 percent to all goods imports from the EU and that the EU responds to goods imports from the USA with additional tariffs of 25 percent.
In addition, it was assumed that service imports from the USA will also be taxed. As a result of such a “customs war” from the authors of the study, German exports into the United States would collapse by almost 43 percent, all -German exports would drop by 3.2 percent and the gross domestic product in Germany collapsed by 0.2 percent.
Regionally clear differences
The largest production declines would naturally exist in the sectors with the greatest export dependency from the United States. The pharmaceutical sector would therefore have hit the strongest with a long -term decline in production of 8.7 percent, followed by the sectors motor vehicles with minus 4.1 percent and machines with minus 3.8 percent.
Regions in which these industries are strongly represented would be disproportionately affected. According to the information, the Bremen regions would be particularly noticeable with minus 0.4 percent, Lower Bavaria with minus 0.3 percent and Leipzig with also minus 0.3 percent.
In relation to the absolute changes in production, the regions of Cologne with minus 4.9 billion euros, Hamburg with a minus of four billion and Darmstadt with minus 3.9 billion are most affected by an “customs war”. Berlin follows with minus 3.2 billion and Upper Bavaria with minus 2.2 billion euros.
At the EU level, the economists calculated that 98 percent of the 237 EU regions would have a loss of income that the median was 0.12 percent with a minus of GDP.
There are also profiteers
But according to the study, there are also sectors that would benefit even in such a scenario. These include “Verlag, Medien and Radio” with a production plan of 3.4 percent. “Other means of transport” could look forward to growth of plus 2.4 percent, “Finanz, Versicherung” increased by 2.3 percent, and the telecommunications sectors would also be among the winners. In all of these sectors, the production losses or gains are larger than short -term in the long term, the economists write.
The industries also provide an indication of which regions would cope with an “customs war” scenario within the EU: “A small profit group, especially finance and logistics hits such as Luxembourg or Malta, reaches up to 0.6 percent,” it says.
“Chaos weeks in world trade”
The background of the investigation is the customs announcements by US President Donald Trump, who also triggered uncertainty with several turns. Therefore, there are tensions with the EU, but also with China. The authors of the study speak with a view of Trump of “Chaos Weeks in World Trade” and a high level of uncertainty. In April, the erratic act of the US President in April had also led to a course of the course at the stock markets. In the meantime, however, they have largely recovered the stock exchanges.
Rainer Kirchdörfer, board member of the family company Foundation, said the US used tariffs used as extortion potential. This leads to a huge uncertainty. The companies should be interested in a stable deal with the USA. “The EU should take this path courageous and clever.” According to the study, the German gross domestic product would grow by 0.6 percent in the long term in a comprehensive trade deal.
Principal loyalty and diversified Trade
As a recommendation for action, the authors advise that the EU must institutionally be able to keep up to hold out trade -political conflicts. “Agency among the Member States is essential for this.”
In view of the growing spread of autocratic regime and the dwindling confidence in the USA as a stable partner, the EU would be able to position itself as a safe refuge, it is said. “To do this, it should consistently maintain principles such as contractual confidence, legal certainty and protection of legitimate expectations and do not give up for short -term advantages.”
The study also underlines that diversification is of great importance even with a view to transatlantic trade to reduce risks. As a result, the economists also consider an EU trade agreement with China, from an economic point of view, it would make sense, but they point out that it is probably difficult to implement politically.
“More international cooperation”
Politicians are currently dealing intensively with the topic of customs conflict and, given the possible economic consequences, struggles to be solutions. “We have to settle the current trade conflicts for the benefit of everyone as quickly as possible,” said the SPD leader and finance minister Lars Klingbeil at a meeting of the seven leading western industrialized nations (G7) in Banff Canada.
Bundesbank President Joachim Nagel spoke of a meltdown on the markets that was shown in April when US President Donald Trump had imposed high special tariffs against almost all trading partners.
“We need more international cooperation,” said Klingbeil. This also includes free trade. “The US tariffs threaten jobs and economic strength on both sides of the Atlantic.” The EU Commission, which coordinates trade policy in the European Union, must now make an effort and find a solution with the USA. The EU would prefer to reduce all industrial tariffs and come to a free trade agreement with the United States in the long term.
