Trump’s Tariffs Could Slash German Exports to US
(MENAFN) US Leader Donald Trump’s tariffs might cause a reduction of more than 38 percent in German exports to the United States, according to the most recent report from the German think-tank, the ifo Institute.
The German manufacturing sector is projected to contract by 2.8 percent if the current deadlock in tariff talks between Washington and the European Union concludes with the imposition of extensive US tariffs on the bloc and Germany specifically.
The report revealed that in this situation, German exports to the US would decline by 38.5 percent, while exports to China would drop by 2.8 percent.
Germany’s automotive and pharmaceutical industries are anticipated to suffer significant losses. The automotive sector might lose up to 6 percent of its added value, and the pharmaceutical industry could face losses as high as 9 percent.
Conversely, the services and agriculture sectors are expected to experience growth of 0.4 percent as a result of the tariffs.
The institute’s projections are based on the potential reinstatement of reciprocal tariffs that were initially announced on April 2, following a 90-day tariff pause and negotiation grace period which ends on July 9.
After July 9, EU exports to the US are expected to be subjected to 50 percent tariffs.
In preparing its forecasts, the ifo Institute accounted for the 25 percent tariffs on steel, aluminum, automobiles, auto parts, pharmaceuticals, and electronic products, while excluding retaliatory tariffs imposed by the EU on US imports.
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