Trump's Tariffs to Significantly Impact US and EU Economies
President Trump's tariff policies are set to significantly impact both the US and European economies. From 1 August 2025, EU importers will face a 30% tariff, except those with US-based production. Meanwhile, Trump's actions are driving US companies like Nike and Apple to relocate production from China to Vietnam.
Trump's tariffs are expected to have a substantial effect on prices. Albrecht Rothacher warns of potential hikes on essential goods like fuel and medicine, which could harm Trump's midterm prospects. The impact is already visible, with the US dollar devalued by over 10% since Trump took office in January 2025.
Trump's trade policy appears to be influenced by personal feelings towards countries. Peter Leibinger, president of the Federation of German Industries (BDI), criticized Trump's policy, stating that it's driven by grudges and friendships rather than economic logic. Trump's focus is on trade in goods, where the EU had a surplus of €197 billion over the US in 2024.
Trump uses tariff threats, waivers, and delays as negotiating tactics to secure 'deals' that benefit him personally. However, critics argue that his policies serve his business interests, not those of ordinary Americans. Trump believes he can finance his 'Big Beautiful Bill' using increased tariff revenue from the budget deficit.
Trump's tariffs are set to cause significant price increases for essential goods and services, potentially damaging his midterm prospects. Meanwhile, US companies are relocating production, and the US dollar has devalued. Critics like Peter Leibinger warn that Trump's trade policy is driven by personal interests rather than economic benefit.
