Prof. Dr. Julian Hinz, Director of Trade Policy at the Kiel Institute for the World Economy (ifw), comments on the trade deal agreed between the EU and the USA on July 27, 2025, which provides for tariffs of 15 percent for European exports to the United States. In view of the dramatic implications of the deal for laboratory medicine, MedLabPortal is publishing the original wording of the scientist’s statement:

“The deal agreed yesterday between the EU and the US is not a good deal – it is appeasement, in other words a policy of appeasement. The EU is trying to avert a trade war in the short term, but is paying a high price in the long term: it is abandoning the principles of the multilateral and rules-based world trade system of the World Trade Organization (WTO), which has been a key guarantee of Europe’s prosperity to date.

The short-term economic consequences of the deal may seem limited – for example, we initially expect Germany to see a reduction in growth of 0.13 percentage points. However, the long-term damage to the multilateral trading system is far greater. The EU should urgently focus on its strengths and increasingly promote trade partnerships with like-minded countries in order to restore support for the rules-based global trading system.

According to WTO rules, member countries must apply the same tariff rates to all other members. Deviations are only permitted within the framework of free trade agreements in which both sides reduce their tariffs to zero. The current deal clearly violates these principles and sets a dangerous precedent. It could encourage other countries to impose politically motivated and arbitrary tariff increases. In the long term, this threatens an escalation of trade conflicts and higher tariffs overall – a development that would hit exporting nations such as Germany particularly hard.

The EU would have had alternatives: instead of entering into a unilaterally disadvantageous deal, it could have formed a coalition with other affected economic nations such as Canada, Mexico, Brazil and South Korea. This would have created an effective counterweight to the US tariff threats. Instead, the deal struck today strengthens President Trump’s strategy of playing other economic nations off against each other.”

Editorial office: X-Press Journalistenbüro GbR

Gender note. The personal designations used in this text always refer equally to female, male and diverse persons. Double/triple references and gendered designations are avoided for the sake of better readability ected.