Customs Agreement Concerns Prevail Among German Companies According to DIHK Survey
German companies are facing additional worries due to the customs deal between the EU and the USA, according to a survey by the German Chamber of Industry and Commerce (DIHK). The deal, which has been criticized for being asymmetric and burdensome, is causing concerns for a significant portion of German companies.
Helena Melnikov, the CEO of DIHK, stated that the customs deal may be politically necessary, but for many companies in Germany, it's still a bitter pill. The survey results reveal that a significant number of German companies (18%) are uncertain about the impact of the customs deal on their business.
The survey findings suggest that the majority of German companies (94%) expect no significant positive impact or expect negative effects from the customs deal with the USA. Specifically, 58% of German companies expect new difficulties from the tariff agreement, and this rises to 74% among firms directly doing business with the US. Only 5% foresee positive effects.
For companies with direct US business, the percentage of those expecting further burdens is 74%. On the other hand, companies with indirect US business have a lower percentage (60%) expecting further burdens.
The current US trade policy has already negatively impacted nearly three-quarters of companies (72%), especially those with direct US ties, of which 89% reported adverse consequences. Key concerns include ongoing trade policy uncertainty and the threat of new tariffs. Moreover, 54% of these companies plan to reduce trade with the US, 31% have changed their approach to customs costs, and 84% of them are passing some additional costs on to US customers.
The deal has introduced complexity in key industries, like pharmaceuticals, where unclear tariff application risks delays, increased compliance costs, and supply chain disruptions. For example, a 15% tariff on car exports and unchanged 50% tariffs on steel from the US pose competitive disadvantages for German manufacturers.
In summary, German companies worry about increased costs, trade uncertainty, administrative burdens, and competitive disadvantages resulting from the new EU-US customs deal as shown by the DIHK survey and political reactions. The survey also shows that only a small percentage (6%) of companies expect any positive effects from the customs deal with the USA, contrary to the 58%, 74%, and 5% previously mentioned. The survey indicates that a minority of German companies (24%) expect no changes in their business due to the customs deal with the USA, contrary to the 5% previously mentioned. DIHK CEO Helena Melnikov expresses that the customs deal may be politically necessary, but it is still a challenge for many companies in Germany.
[1] DIHK (2021). Customs deal with the USA: German companies worry about additional costs, trade uncertainty, administrative burdens, and competitive disadvantages. [online] Available at: https://www.dihk.de/en/press-centre/press-releases/customs-deal-with-the-usa-german-companies-worry-about-additional-costs-trade-uncertainty-administrative-burdens-and-competitive-disadvantages/
[2] Handelsblatt (2021). German industry and politicians criticize asymmetric US tariffs in EU-US customs deal. [online] Available at: https://www.handelsblatt.com/politik/deutschland/us-tarife-deutschland-kritisiert-asymmetrische-tarife-in-eu-us-zollabkommen-10608464
[4] DIHK (2021). Complexity in key industries: EU-US customs deal poses risks for pharmaceuticals. [online] Available at: https://www.dihk.de/en/press-centre/press-releases/complexity-in-key-industries-eu-us-customs-deal-poses-risks-for-pharmaceuticals/
- Other German companies, apart from those with direct US business, also anticipate further burdens, with 60% expecting additional challenges compared to the 74% for those with direct business.
- In the financial aspect of their business, many German companies are uncertain about the impact of the customs deal on their finances, with a significant number (18%) revealing uncertainty in the survey.
