Second Trump presidency could rile global economic order, trigger trade and investment war ‘on steroids’

Sander Tordoir, chief economist at the Centre for European Reform (CER), noted that Trump’s 10% tariff on global goods would especially affect Germany, the bloc’s largest economy, which is already reeling from a combination of weak demand and growing competition from China.

“10% is not a massive tariff, but it will definitely hurt German exports, in an era in which they’re already struggling,” he said.

Tordoir explained that, with the US having recently surpassed China as Germany’s top trading partner and with the EU as a whole currently running a trade surplus of more than €150 billion with the US, the risks of a US-EU trade war are “asymmetric”.

He also noted that US protectionism would only compound Germany’s difficulties in finding suitable export markets, given China’s increasing tendency to impede foreign firms’ access to its own economy.

“I would be very worried about that if I were running economic policy in Berlin, because it is really not that obvious where you can sell German capital goods, if the two largest economies of the world are no longer providing that kind of market access,” he added.