Will whiskey become more expensive?

EU/USA trade dispute: Austria little affected

The trade dispute between the EU and the USA is hardly affecting Austria's economy for the time being (symbolic image).(Bild: AP/Martin Meissner)

The trade dispute between the EU and the USA will not have a major impact on the Austrian economy for the time being. Prices for whiskey and motorcycles could rise slightly, said trade economist Harald Oberhofer. However, a serious inflationary effect is not to be expected.

"Economically, what is now known is not so relevant that it can generate noticeable inflationary effects". As reported, the US government under President Donald Trump has introduced tariffs on steel and aluminum imports from the EU. In turn, the European Union has announced import tariffs on luxury and consumer goods from the USA.

For Oberhofer, these are primarily "symbolic products, not export hits". This raises the question of whether the import duties will actually be passed on to consumers. In principle, the goods in question are easy to circumvent, said the trade economist. The EU was in a very similar situation in 2018, when motorcycle manufacturer Harley Davidson incurred additional costs.

In economic terms, what is now known is not so relevant that it can generate noticeable inflationary effects.

Handelsökonom Harald Oberhofer, WU/WIFO

Agreement still possible?
The EU Commission is open to talks with the White House. If there is no agreement in the trade conflict, this will certainly "put pressure on prices", said Oberhofer. The consequences would be severe if the tariffs were to apply across the board and affect sectors such as the automotive industry.

The US steel and aluminum imports, which have been in force since today, Wednesday, will affect the Linz-based steel group voestalpine and the Upper Austrian aluminum group AMAG in particular. Oberhofer said that voestalpine could largely cushion the costs through its own production in the USA. For American companies, the tariffs will increase input prices, and their competitive position may deteriorate as a result.