World trade
IW: US criminal tariffs would reduce economic output
The original customs plans of the US government would have a strong impact on the economic output of the affected countries. IW economists have calculated how much the performance could decrease.
According to IW economic researchers, the originally announced US criminal offenses on imports from Canada, Mexico and China would also have negative effects on the German economy. In the event that the recently exposed additional tariffs of 25 percent on imports from Mexico and Canada still come, the Institute of German Economy (IW) expects German economic output to be around 0.4 percent lower in 2026. This is the result of an IW simulation that is available to the German Press Agency in advance. The model calculations were based on data from the consulting company Oxford Economics.
US President Donald Trump had arranged additional tariffs of 25 percent by imports from Mexico and Canada and 10 percent for imports from China. After concessions, especially when it comes to border security, he pushed the trade restrictions against Mexico and Canada for at least 30 days. So far there has been no such agreement with China. The People’s Republic announced counter -duties and measures against American companies.
IW: Germany would be indirectly affected
Germany would be indirectly affected by the originally planned tariffs, according to the IW. “German exporters may benefit from deflection effects occasionally when their products replace US imports from Canada, Mexico or China who suffer from the new tariffs,” the study said. However, negative consequences for the German economy can then be expected overall.
For example, German preliminary products would be processed in the three countries and sold to the USA. A total of around 12.5 billion euros of the entire German gross value added to the exports of these three countries to the USA. According to the IW, the customs conflict should also significantly dampen the growth of the affected countries and thus also their demand for German products. In addition, the trade conflict increases the global economic policy uncertainty.
According to the IW calculations, the measures originally planned would mean a 0.3 percent lower economic output for the EU in 2026. “For the world as a whole, the effect amounts to minus 0.4 percent.” In this case, the costs of the originally planned US criminal duties for the German economy would add up to around 25 billion euros for the years 2025 and 2026.
dpa
Source: Stern
