Kiel (dpa) - In a trade war with the United States, economist Gabriel Felbermayr believes that Europe could be hard on the transatlantic partner.
"We still have great economic power in Europe, and we can fight back if we want," said the head of the Kiel Institute for the World Economy in an interview with the German Press Agency. That sounds very warlike. "But in the first step, the threat of retaliation, for example with counter-tariffs, is supposed to prevent countermeasures from actually being used."
Felbermayr expects that in 2020, after the first partial agreement and because of the US presidential election, a kind of ceasefire will prevail after three years of escalation in the trade dispute between the United States and China. The opposite is true for US trade relations with Europe. He fears that Europe will be at the center of US trade diplomacy or trade campaigns - “therefore not good news for Europe”.
US President Donald Trump has concluded or renegotiated trade agreements with South Korea, Japan, Canada, Mexico. "Europe is still missing," said Felbermayr, who was scheduled to hold his inaugural lecture on Wednesday evening as a professor at Kiel University on the subject of "Trade War in the 21st Century".
In the opinion of Felbermayr, EU Commission President Ursula von der Leyen must make it particularly clear that Europe is ready to use its instruments if the United States or China are hostile to Europe in economic policy terms.
He cited the US threat to impose punitive tariffs on cars from the EU as examples. "The more credible the message of EU countermeasures comes across, the less likely it is that this unfriendly act will come from Washington."
Felbermayr admitted that countermeasures by Europe in goods trading against punitive measures by the United States would not impress. Because Europe, like China, has a large export surplus to the USA. In this respect, an escalation in goods trade would affect Europe more than the USA. But Europe has a huge deficit vis-à-vis the Americans, especially when it comes to digital services. "That is why the digital tax is an element where we can show our teeth in Europe - should there be an escalation - compared to the USA."
France had introduced a digital tax for international internet companies such as Google, Amazon, Facebook and Apple in 2019 - after a European solution was not found. Since then, the United States has threatened tariffs on French luxury goods. However, there have recently been signals indicating a possible relaxation.
Felbermayr cited mobile phone operating systems such as Android or Apple's iOS as examples of digital services. "Ultimately, every user fee is a service export to the United States." It's also about financial services, where the United States has large surpluses, it's about the entertainment industry, Hollywood, or the music industry. It's about business-related services. “So the Americans have considerable surpluses with Europe in many areas of services. But they are growing fastest in the area of digital services. »
For the future, Felbermayr sees different developments in the relationships between the three economic power blocks, the USA, China and Europe: “I think it boils down to a kind of a position war, a material battle, between the USA and China, if you will. It causes costs for both sides, even if you will now be reluctant to do so next year. »Because the first partial agreement, which China has committed to additional imports from the USA in the amount of $ 200 billion annually, is hardly feasible. "I believe that this phase will disintegrate after two years - and then there will be another escalation."
Communication difficulties also existed between Europe and the USA, between Europe and China. "If Europe is strong enough, stays united and also lays out the instruments that it needs to be credibly defensive, we will be able to establish ourselves as a third player - maybe as a junior player, but still as a respected force. And that is why I believe that in this triangle between Europe, the United States and China, a balance can be found, but I do not see that between China and the United States. »Trade wars are, according to Felbermayr, based on the Prussian Carl von Clausewitz (1780- 1831), a mere continuation of politics by other means.