The warning issued by Gabriel Felbermayr of the German Council of Economic Experts, alongside broader assessments from Berlin’s economic ministry, highlights growing anxiety across European industrial and trade sectors regarding Washington’s enduring protectionist trajectory.
Core Details:
Despite political shifts following the U.S. midterm elections, economic analysts warn that the outcome is unlikely to soften the administration’s rigid trade posture, as a politically constrained or gridlocked Washington continues to lean heavily on executive actions and presidential decrees.
“This could come to a head as early as the beginning of next year, particularly with regard to China, as certain deadlines are set to expire,” said Felbermayr during the presentation of the five-member council’s annual report on Wednesday.
“For the German export sector, this means that the US market – which had shown improvement over the last two or three months, with Germany partly benefiting from the AI boom – could see a cooling off.”
Impending Deadlines:
Tariff pressures are projected to escalate early next year as critical policy deadlines approach, particularly concerning China, which experts warn could trigger broader secondary trade friction impacting European allies.
This rising trade uncertainty comes on the heels of a brief, positive uptick in the German export market over preceding months, a window partly buoyed by global artificial intelligence infrastructure demands.
However, Berlin officials caution that mounting tariff risks threaten to reverse these gains, leading to a cooling-off period for German manufacturers heavily dependent on the lucrative U.S. market.
Cooling Off the German Export Sector:
German economic institutes increasingly view the structural shift toward “America First” industrial policy as a permanent fixture rather than a short-term hurdle, underscoring an urgent need for European exporters to hedge against trade volatility through tighter market diversification and strategic resilience.
