German experts have warned of a looming trade war between Europe and the United States after the Trump administration imposed 25 percent tariffs on steel products imported from the European Union.
Starting from Wednesday, the U.S. government imposed 25-percent tariffs on imported steel and aluminum.
In response, the European Commission announced on Wednesday that it will impose retaliatory tariffs on 26 billion euros (about 28 billion U.S. dollars) worth of U.S. goods from next month.
German experts warned that the retaliatory measures could evolve into a trade war and take heavy toll on consumers on both sides.
"This is just the beginning. The United States will further increase tariffs in April. The European Union has also drawn up a list of goods covering wood, food and other products in response to U.S. tariffs. The situation could escalate and evolve into a trade war. This is bad news for consumers," said Guntram Kaiser, a media professional.
In April, the United States is expected to impose tariffs on all imported cars, which has triggered great concern among the German business community.
German carmaker BMW said on Friday that the U.S. tariffs on cars are estimated to reduce the enterprise's revenue by one billion euros this year, and even lead to "a change in the company's business prospects."
The German central bank said on the same day that the U.S. tariff measures could put Germany in trouble. If the U.S. continues to impose tariffs on Germany, the country is expected to experience an economic recession this year, according to the Deutsche Bundesbank.
Jochen Kockler, organizer of Hannover Messe trade fair, said that the move will not only strike a blow to the German auto industry, but may also trigger a chain reaction.
"As the organizer of the Hannover Messe, I don't support tariffs. I believe in competitiveness and doing what you do best. Of course, if our trading partner decide to impose a 25-percent tariff on our products, Europe will inevitably respond. I think trade retaliation is inevitable," he said.
Faced with the U.S.' protectionist trade policies, German consumers have begun to boycott U.S. products, and various related initiatives have emerged in the country.
According to the latest survey conducted by a polling agency commissioned by Handelsblatt business daily, 51 percent of respondents said they had bought fewer U.S. products, and stayed particularly cautious when choosing U.S. brands in supermarkets.
Economists warn that the ultimate cost of the trade war will be borne by global consumers and companies.
The Germany-based Kiel Institute for the World Economy said that the U.S. tariff policy on steel and aluminum products has little direct impact on the EU economy, but its chain reaction may endanger the stability of the supply chain, leading to reduced investment and increased employment risks.
German experts warn of potential trade war between Europe, USA following Trump tariffs
German experts warn of potential trade war between Europe, USA following Trump tariffs
German experts warn of potential trade war between Europe, USA following Trump tariffs
