German Manufacturers Unconcerned At US Border Taxes
Friday, March 17, 2017
Most German manufacturers exporting to the United States will not shift production
to the US as a result of the imposition of new border taxes, according to a
survey by the Ifo Institute.
The survey of 2,700 companies showed that while there is a degree of anxiety about
US proposals for border taxes, which are designed to reduce the level of imports and boost
domestic production, three-quarters of the respondents expect that
such taxes, if imposed, would have no impact on their sales.
Gabriel Felbermayr, Head of the Ifo Center for International Economics, said
that German companies "do not seem to be over-concerned" about the
prospect of higher tariffs or taxes on trade with the US.
"Only 18 percent expect a drop in sales, but six percent expect an increase
and 76 percent foresee no change," he added.
Nevertheless, a substantial percentage of those surveyed still anticipate that
the US will increase barriers to trade, with 45 percent expecting new customs
duties, and 36 percent predicting increases in existing trade barriers.
Of the 46 percent of companies which export to the US, 21 percent said they
are likely to shift more production to the US as a result of President Trump's
trade policies. Only seven percent of companies with current operations in the
US plan to establish more subsidiaries there. In total, 28 percent of German
manufacturers active in the US will increase their value added in the country,
the survey revealed.