Customs Agreement perceived as a difficult concession within the Unholy Alliance - Customs Agreement Viewed as a Painful Concession by Export Association
The EU and the USA announced a landmark trade deal in late July 2025, aimed at strengthening economic ties between the two continents. The agreement, which has been met with mixed reactions, poses both challenges and opportunities for German traders, particularly those in the export sector.
The deal sees the USA imposing a 15% tariff on most EU goods, a figure significantly lower than the initially threatened 30%. In return, the EU has committed to purchasing approximately $750 billion worth of US energy-related goods over three years and making an additional $600 billion in investments in the US.
For German exporters, the reduced tariff from 30% to 15% may lessen export costs and diminish the risk of a damaging trade war, helping preserve their competitiveness in the US market. However, the 15% tariff still represents an increase compared to previous tariff-free access to the US market for many goods, particularly for German manufacturers in sectors such as automotive, machinery, and industrial equipment. This could potentially lead to increased costs or pricing pressure.
The deal also emphasises addressing non-tariff barriers and improving regulatory alignment. This could benefit German exporters by smoothing customs and standards approvals, notably in high-tech and agricultural sectors. However, expanded US exports and investments, along with EU commitments to buy US energy and military equipment, may rebalance trade flows but do not directly compensate Germany for increased tariffs on its exports.
The Federal Association of Wholesale, Foreign Trade, and Services (BGA) in Berlin has expressed concerns about the agreement. The organisation describes the deal as a painful compromise for the German export industry, a cornerstone of the EU's economy and heavily export-driven.
Experts describe the deal as avoiding a full trade war and keeping vital transatlantic trade relations stable, which is crucial for Germany’s export-reliant economy. However, they also warn that the overall impact on Germany will depend on sector-specific exposure and the pace of implementing the non-tariff measures.
In summary, while the deal avoids the most severe tariff hikes, the 15% tariff constitutes a new trade cost for German exporters to the US. This cost is mitigated to some degree by regulatory cooperation and non-tariff barrier reductions. The ultimate impact on Germany will be determined by sector-specific exposure and the speed of implementing the non-tariff measures.
[1] EU-US Trade Agreement: Key Provisions and Implications for Germany
[2] EU-US Trade Deal: A Necessary Compromise for Germany's Export Industry
- The EU-US Trade Agreement includes a community policy that aims to address non-tariff barriers and improve regulatory alignment, which could potentially benefit German exporters in high-tech and agricultural sectors by smoothing customs and standards approvals.
- In the wake of the EU-US Trade Agreement, the employment policy for German manufacturers in sectors such as automotive, machinery, and industrial equipment could face increased costs or pricing pressure due to the 15% tariff imposed on most EU goods in the US market.
- The announced EU-US Trade Deal highlights the importance of maintaining stable business ties between the two continents, particularly in the finance and politics sectors, as the overall impact on Germany will depend on sector-specific exposure and the pace of implementing the non-tariff measures.
