MILAN – There are nonetheless numerous ifs, however failure to barter U.S. President Donald Trump‘s 30 p.c tariffs on European items by the Aug. 1 deadline may reverse Italian financial progress forecasts for 2025.
In keeping with EY‘s current Parthenon Bulletin, Italy‘s gross home product may fall as a lot as 1.4 p.c because of the tariffs, which might have a unfavorable impression of slightly below 30 billion euros, stated EY Parthenon managing companion Marco Daviddi. Parthenon is the accounting agency’s technique and transaction division.
In keeping with economists at Istat, forecasts in June stated the Italian economic system was truly anticipated to develop 0.6 p.c in 2025 and 0.8 p.c in 2026, lifted by enhancing home demand.
“Taking these components under consideration, it appears unrealistic to foresee a last settlement between the EU and the U.S. that will set tariffs round 10 p.c, as indicated within the estimates and expectations of European establishments,” the EY report stated, including that tariffs will unlikely settle at beneath 20 p.c.
“The implications for world progress and monetary markets are important, though essentially the most important results might be felt throughout 2026,” the report added.
Trump posted letters to Fact Social detailing the brand new responsibility charges for Mexico and the 27-member European commerce bloc on July 12.
Previous to Trump’s letter, Confindustria’s president Emanuele Orsini had already raised alarm over the unique 10 p.c tariffs and stated collectively, with the devaluation of the U.S. greenback, greater tariffs would lead to a lack of 20 billion euros in exports and 118,000 jobs by 2026. The greenback hit its lowest level in opposition to the euro in 4 years on the finish of June. Confindustria is Italy’s important industrial federation.
In 2024 the textile and attire sector exported over 2.75 billion euros value of products to the U.S., making it the third largest marketplace for the sector, Luca Sburlati, president of Confindustria Moda, advised WWD.
FederlegnoArredo, the Italian federation of woodworking and furnishings industries which represents the vast majority of Europe’s luxurious furniture-makers, stated the U.S. was Italy’s largest further EU market and exports to the U.S. have been value 2.8 billion euros in 2024.
FederlegnoArredo’s president Claudio Feltrin stated a 30 p.c tariff on items could be a tipping level for the business and would have a extreme impression jobs and progress.
“Confronted with the information of Trump’s determination to introduce 30 p.c tariffs on EU exports to the U.S., we will solely be involved and alarmed. Europe should keep away from a tariff-against-tariff battle that will profit nobody,” Feltrin stated, including that the whole European manufacturing system could be severely impacted. “Failing to defend our companies now may end result within the industrial desertification of the Previous Continent,” he added.
European flags in entrance of the European Fee in Brussels.
Courtesy of EU/Dati Bendo
Negotiations on the EU Degree
The EU and continues to weigh its choices with the purpose of reaching some form of center floor. Economists have stated that the EU has just a few negotiating chips to play, like providing to spice up its imports of U.S. navy gear, and cut back tariffs and restrictions on U.S. imports like vehicles.
There’s additionally the choice of negotiating down the U.S. items commerce deficit with the EU, which swelled to $235.6 billion in 2024, in keeping with U.S. authorities information. The EU, however, has a commerce surplus with the U.S., which stood at 17.9 billion euros in December 2024.
Trump’s letter to the EU included a requirement that Europe drop its personal tariffs. “The European Union will enable full, open market entry to the USA, with no tariff being charged to us, in an try to scale back the massive commerce deficit,” he wrote.
— With contributions from Andrea Onate in Milan
