Small and Medium Enterprises (SMEs) in Germany express worries over potential unintended consequences of US tariffs

US Tariffs: German Small Businesses Fret Over Indirect Fallout

German Small and Medium Enterprises (SMEs) express significant worry about the unforeseen repercussions of US tax laws - Small and Medium Enterprises (SMEs) in Germany express worries over potential unintended consequences of US tariffs

Small and medium-sized enterprises (SMEs) across Germany are sweating over the potential indirect implications of US tariffs, according to a study by DZ Bank. These companies, predominantly in the metal, automotive, and machinery sectors, anxiously gaze upon potential price hikes of their goods in the US or dwindling demand for exports to the States.

Many believe that their trading partners' businesses will suffer due to US tariffs, thus adversely impacting their own operations. Roughly two-thirds of businesses in these sectors fret about such indirect consequences.

While 29% of companies are nonchalant about US tariffs, potential EU counter-tariffs could deal a harder blow to German businesses than the actual import duties in the US. A quarter of businesses expect direct consequences, such as higher purchase prices, whereas only 19% foresee no adverse effects.

Yet, DZ analyst Claus Niegsch suggests that worry over cost spikes could be premature: "While US goods may inflate, goods from other countries traditionally bound for America could end up in Europe, thereby lowering prices here."

DZ Bank surveyed 1,000 German SME proprietors and managers between March 6 and March 26. At that juncture, the specific tariffs on goods from the EU were yet to be decided, but a 25% tax on the automotive sector and 25% tariffs on steel and aluminum had been in effect since March 12. The survey is said to be representative.

Germany, DZ Bank AG, USA, SMEs, EU, Frankfurt am Main, Metal, Machinery.

1. The anxiety among SMEs in EC countries, particularly in the metal, automotive, and machinery sectors, stem from the potential indirect repercussions of US tariffs on their goods in the US.
2. Claus Niegsch, an analyst at DZ Bank, suggests that the concerns about cost spikes due to US tariffs might be premature, as goods from other countries traditionally bound for America could end up in Europe, potentially lowering prices.
3. Despite 29% of companies being nonchalant about US tariffs, roughly two-thirds of businesses in these sectors are worried about the potential indirect consequences on their operations due to the US tariffs affecting their trading partners.
4. A quarter of businesses surveyed by DZ Bank expect direct negative effects, such as higher purchase prices, while only 19% foresee no adverse impact from US tariffs.
5. The US tariffs on goods from the EU, which were in effect since March 12, could result in a heavier blow to German businesses if EU counter-tariffs are implemented, according to the survey conducted by DZ Bank.

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