idw – Informationsdienst Wissenschaft
Nachrichten, Termine, Experten
Nachrichten, Termine, Experten
Prof. Dr. Julian Hinz (https://www.ifw-kiel.de/experts/julian-hinz/), expert on international trade at the Kiel Institute, comments on the recently agreed trade deal between the EU and the US, which imposes a 15 percent tariff on European exports to the United States:
“The deal agreed yesterday is not a good deal—it is appeasement. While the EU may avert a trade war in the short term, it is paying a high price in the long term by abandoning the principles of the multilateral, rules-based world trade system of the World Trade Organization (WTO), which has been instrumental in guaranteeing Europe's prosperity to date.
While the short-term economic consequences of the deal may seem limited—we expect growth in Germany to initially be reduced by 0.13 percentage points—the long-term damage to the multilateral trading system is far greater. The EU should urgently consider its strengths and promote trade partnerships with like-minded countries.
Under WTO rules, member countries must apply the same tariffs to all other members. Deviations are only permitted under free trade agreements in which both sides reduce their tariffs to zero. The current deal clearly violates these principles and sets a dangerous precedent. It could encourage other countries to impose arbitrary and politically motivated tariff increases. In the long term, this could lead to an increase in trade conflicts and higher tariffs overall—a development that would affect exporting nations such as Germany particularly badly.
Instead of agreeing to a disadvantageous deal, the EU could have formed a coalition with other affected economies, such as Canada, Mexico, Brazil, and South Korea. This would have created an effective counterweight to US tariff threats. However, the deal concluded today strengthens President Trump's strategy of pitting other economies against each other.”
Media Contact:
Mathias Rauck
Chief Communications Officer
T +49 431 8814-411
mathias.rauck@ifw-kiel.de
Kiel Institute for the World Economy
Kiellinie 66 | 24105 Kiel | Germany
Chausseestraße 111 | 10115 Berlin | Germany
T +49 431 8814-1
E info@ifw-kiel.de
www.ifw-kiel.de
Prof. Dr. Julian Hinz
Director Trade Policy
T +49 431 8814-507
julian.hinz@ifw-kiel.de
Criteria of this press release:
Business and commerce, Journalists, Scientists and scholars
Economics / business administration, Politics, Social studies
transregional, national
Transfer of Science or Research
English
You can combine search terms with and, or and/or not, e.g. Philo not logy.
You can use brackets to separate combinations from each other, e.g. (Philo not logy) or (Psycho and logy).
Coherent groups of words will be located as complete phrases if you put them into quotation marks, e.g. “Federal Republic of Germany”.
You can also use the advanced search without entering search terms. It will then follow the criteria you have selected (e.g. country or subject area).
If you have not selected any criteria in a given category, the entire category will be searched (e.g. all subject areas or all countries).
