BRATISLAVA, 23 August (WebNoviny.sk) – The introduction of 25 per cent rates on car imports from the European Union to the US would make the Slovak economy, a large part of the car industry, feel.
However, the analysts do not expect a more significant impact from the possible introduction of this measure. The analysis by the Financial Policy Institute at the Ministry of Finance anticipates a possible negative effect on the growth of the Slovak gross domestic product, ranging from 0.03 to 0.11 percentage points, which analysts consider to be real.
Lower number of cars produced
"This impact is mainly due to the weakening of the export of cars from Slovakia to the US It is also possible that this could be reflected in the lower number of cars produced and thus in the number of employees in the car factory, " SITA said analyst Poštová banka Lucia Dovalová.
Car manufacturers will, however, clearly try to avoid this scenario and focus more on other markets. Indirectly, our economy can also be negatively affected by the impact of import duties on our trading partners.
Although the United States is not the biggest trading partner of Slovakia, we mainly export cars. As the Slovenská sporiteľňa Katarína Muchová analyst observes, last year 20% of the total exports of the Volkswagen plant in Bratislava were in the US.
"However, it is predominantly luxury vehicles where the price sensitivity is lower than that of the lower cars." The impact would not be so important, " she added.
The question is the reaction of Brussels
However, the introduction of tariffs for European cars in the US should not end the pressure on business relationships. "The question remains the answer of the European Union to this last American step, namely the possibility to introduce countermeasures," Says a lot.
As Lucia Dovalova added from the Poštová bank, reciprocal customs clearance can lead to a reduction in international trade and an increase in costs for US and European companies, which is likely to undermine economic growth.
According to Katarína Muchová from Slovenská sporiteľňa, the acceptance of import duties on cars by the US party would ultimately not be good for American consumers either.
"In the case of the US, this will increase prices for domestic consumers, not just in the case of European cars, but if the tax also applies to the components, American cars can also rise slightly " he says.
Trump's statement during a presidential meeting
US President Donald Trump has announced that his country will import 25 percent of car import tariffs from the European Union. He expressed himself on Tuesday evening in West Virginia during a pre-election meeting.
The website of the CNBC internet portal reported that the presidential statement only came a few hours after the Wall Street Journal reported that the US Trade Minister Wilbur Ross said he had postponed the publication of the car tax report.
The daily minister said it was unclear whether the report on potential tasks would be published by the end of August. Ross also refused to set a new deadline for submitting a report. The Minister noted that the report would be postponed given the ongoing negotiations with Mexico, Canada and the European Commission.
He added that studying material submitted by car manufacturers took longer than expected. Automobiles are usually opposed to accusations that, according to critics, will increase prices for consumers.