Worse Than Hoped, Better Than Feared

Volker Treier, Head of Foreign Trade at the DIHK, provided a nuanced assessment: Despite significant burdens from tariffs and uncertainty, German export activity is faring better than feared. Poland has already overtaken China as the most important export market for German companies. "Not good, but not as bad as we might have feared." The taboo risk factor is energy dependency: 75% of Germany's energy consumption is still derived from fossil sources. His call to Europe: "If we work together, the dwarfs of Europe can become a giant – but we have to cooperate." He judged the current tariff deal with the US until 2029 pragmatically: necessary, but "a deal, and no more than that."

Trade Agreements Can Outperform Trump Tariffs

Lisandra Flach (ifo Institute Munich) presented robust research findings: A consistent EU trade offensive – ratifying concluded agreements with seven partners – has significant potential. "New trade agreements can not only offset the negative impacts of Trump tariffs but even surpass them." Germany's GDP could increase by 0.2 to 0.5 percent permanently. However, she warned: Mercosur countries have since made China their most important trading partner. Europe needs to become more pragmatic. For SMEs, rules of origin remain a significant hurdle. An important, often underestimated dependency are maritime choke points: 10% of German trade flows through the Bab el-Mandeb strait and the Suez Canal, while only 0.2% through the Strait of Hormuz – the latter lacking alternative routes for energy goods.

WTO Without Future – Regionalisation is Inevitable

Michael Burda (HU Berlin) expressed open scepticism about the WTO's future: Regionalisation into three blocs – America, China, and Europe – is inevitable. "There are losers with every free trade agreement – and they make themselves heard." He pointed out that the US would never be willing to act against its own interests. "The WTO cannot be reformed as long as the US is in charge." On the Taiwan issue, he warned of systemic moral hazard: companies rely on someone bailing them out when things get serious. China itself is extremely calculated: "China is extremely cautious and has many interests to defend." On Germany's energy issue, Burda warned: Gas prices remain twice as high as in the previous decade – trade agreements do not resolve this core problem.

Video

If you want to hear the full speeches or watch the entire Panel-3-discussion, simply click on this video: