The tariff agreement between the European Union and the United States represents a significant burden for parts of the German economy, a top economist said on Monday.
Tariffs of 15% are an "enormous burden for the economy, not only here but also in the US," Ulrike Malmendier, a member of the German Council of Economic Experts, said on public broadcaster ARD. In previous years and decades, a rate of approximately 1% had applied, she noted. "In comparison, this is already a drama."
Malmendier, who teaches in California, said that the impact could be significant, especially for individual companies and sectors. However, she noted that it is difficult to assess what the new levy means for the overall economy.
Possible positive effects for consumers
Many countries have poorer access to the US market due to the tariffs and must offer their goods elsewhere, such as in the EU, according to Malmendier. This could even have a positive effect on inflation domestically, she said.
The EU and US had agreed on a deal in the long-simmering tariff dispute on Sunday. It provides for a tariff rate of 15% for the majority of imports from the 27-nation bloc. In addition, there are agreements on investments and energy imports.
'A kind of ceasefire'
Trade expert Laura von Daniels from the German Institute for International and Security Affairs (SWP) said that the European Commission had wrested "a kind of ceasefire" from US President Donald Trump.
"Contentious issues such as European service taxes, digital regulation and artificial intelligence have been put on the back burner. German companies, in particular, are now benefiting from this," von Daniels told dpa.
"The deal gives the EU important time, which it should use to reduce dependencies and prepare for further conflicts with Trump and also with China, and to better align its goals and priorities."
German government praises deal
German Chancellor Friedrich Merz welcomed the agreement, which he said successfully "averted a trade conflict." He emphasized that "the unity of the European Union and the hard work of the negotiators have paid off." The chancellor thanked von der Leyen and Trade Commissioner Maros Šefčovič.
"In the upcoming negotiations on the details of the agreement, the European Commission has my full support," the chancellor said, adding that efforts must continue to strengthen trade relations with the US.
Merz also stated that Europe had been able to protect its core interests, although he would have liked to see further trade facilitation. "Stable and predictable trade relations with market access for both sides benefit everyone – on both sides of the Atlantic, businesses and consumers alike."
However Merz's deputy spokesman told reporters that the government is still hoping for relief from the 50% tariffs on steel and aluminium following the 15% compromise on other goods.
There is still a need for further negotiations in this area, deputy government spokesman Sebastian Hille said in Berlin. "This is one of the areas we will pay particular attention to," he added. He did not name any other areas.
German Economy Minister Katherina Reiche said on Monday that the tariff agreement reached between the European Union and the United States poses a challenge for German exporters.
"The agreement, with a base tariff of 15%, is certainly something that will challenge us, but the good part is: it provides certainty," Reiche said during a visit to a chemical factory in Leuna in eastern Germany.
Source: www.dailyfinland.fi
