Are cars cheaper?
Consumers in the EU could benefit from the customs deal
The customs deal with the USA is difficult for many companies. European consumers, on the other hand, could even benefit, for example when buying certain car models.
Car buyers in Germany could benefit from customs cleaning between the EU and the USA, according to experts. SUVs from German manufacturers such as Mercedes or BMW, which produce and export to the EU in the United States, may be cheaper by the new deal, said Jürgen Matthes from the Institute of German Business (IW) in Cologne.
The EU and the United States had agreed on a basic customs set of 15 percent for most EU imports to the United States at the weekend. US cars should be able to be imported into the EU in the future. So far, a customs rate of ten percent applies. In order for US cars to become cheaper for consumers, “the price reductions would also have to be passed on,” said Matthes of the German Press Agency.
The Federal Association of Wholesale, Foreign Trade, Services (BGA) was expressed with regard to possible price developments. “The expectations of falling prices from customs cleaning should not be exaggerated,” said BGA President Dirk Jandura. “Yes, import duties are now eliminated on certain products such as cars – but whether this is important to the customer is questionable.”
Could certain products become more expensive?
“The most important news for consumers in Germany is that this deal will initially have no European counter -tariffs on goods from the United States,” said Andreas Baur from the IFO Center for Foreign Affairs in Munich. Such countermeasures would lead to a price increase among the US products concerned. But that is not the case.
It is still unclear to what extent the EU actually contains the EU’s customs for US products. In a paper of the white house for customs cleaning, it says that the EU will completely abolish all tariffs to US industrial goods. “That would let the price of US products in Germany sink in the tendency,” said Baur. However, the tariffs for US industrial goods are already relatively low on average.
GDP could shrink by 0.2 percent
According to Matthes, the US tariffs on German imports are a “strong damper” for the economy in Germany. In particular, this has negative consequences for companies that rely on the USA, for example in the pharmaceutical industry, the auto industry and in mechanical engineering. The United States is the most important export partner in Germany. Around a quarter of exports even go there in the pharmaceutical sector.
“A deal may easily lower the uncertainty for companies-but US tariffs of 15 percent damage to the German economy,” said the head of the IFO Center for Foreign Affairs in Munich, Lisandra Flach. “That would have an effect of minus 0.2 percent on gross domestic product.”
Customs deal a “lazy compromise”
The agreement is expected to ensure that added value in German industry is falling by around 1.5 percent, Flach said. The sale of German goods to the USA in particular could fall permanently – almost 16 percent. Some goods would be redirected to other countries, but the overall German exports are likely to decrease slightly. According to the institute, the numbers are based on a simulation that was calculated after the deal became known.
“This somewhat lazy compromise will slow down the relaxation, that is, the way out of the recession,” said BGA President Jandura. “The supply chains will adapt to the new circumstances and, if necessary, shift to other regions. But that takes.”
Dpa
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Source: Stern
