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Bratislava – In the event that the United States of America, led by President Donald Trump, proceeds with the implementation of trade measures on the European Union, Slovakia will be the most affected country. One of the most affected sectors will be the automotive industry, which could experience a loss of up to 300 million euros annually in the event of increased tariffs. This was pointed out on Monday by the Association of Industrial Unions and Transport (APZD), which also emphasized the potential loss of jobs in the domestic economy, reports TASR.
“If Donald Trump imposes trade tariffs against the EU, Slovak businesses will be forced to face a dramatic increase in the cost of their products, which will reduce their sales in the American market and threaten hundreds of jobs in Slovakia. If 10% tariffs are imposed on European cars, Slovak cars in the American market will become more expensive, and their sales could drop by 6% to 9%. In this segment alone, it would mean a loss of exports amounting to 150 million euros to 300 million euros annually,” said the association’s general secretary Andrej Lasz after the USA announced tariffs on Canada, Mexico, and China last week.
The drop in demand for products from the domestic automotive sector could threaten thousands of jobs, according to experts. Lasz emphasized that car manufacturers and their suppliers are key employers, especially in the less developed regions of Slovakia. If tariffs curb exports, the first affected would be workers in production, he said. In this context, he estimated that a four percent drop in exports could increase overall unemployment in Slovakia by 0.2 to 0.5 percentage points.
The association calculated that, should the trade war between the EU and the USA deepen, Slovak exports could decrease by up to 4.4 billion euros by the end of 2029.
Moreover, due to the US withdrawal from the Paris Climate Agreement supported by the EU, companies there do not have to comply with strict emission limits, which, according to the association, makes their production cheaper.
“European manufacturers will face a double blow. Their products will be more expensive on the American market due to tariffs, and they will also be at a disadvantage compared to domestic companies that have more leeway in reducing costs. It looks like the European industry is facing very difficult years,” added Lasz.
The issue was also highlighted last week by Slovak Finance Minister Ladislav Kamenický (Smer-SD): “Slovakia’s exports to the USA are dominated by cars. We exported production worth about 4.5 billion euros to the USA, 90% of which are machinery and automobiles. Within the V4 countries, Slovakia has the largest share of exports to the United States, amounting to 5.8%. So it is very important whether the USA will impose tariffs.” (3rd February)
“European manufacturers will face a double blow. Their products will be more expensive on the American market due to tariffs, and they will also be at a disadvantage compared to domestic companies that have more leeway in reducing costs. It looks like the European industry is facing very difficult years.” Andrej Lasz