Clemens Fust, a leading German economist and head of the Munich-based Ifo Institute for Economic Research, said that Germany could face a recession in 2026 as a result of new tariffs imposed by the United States.
The economist fears serious consequences if the European Union in turn imposes tariffs on US goods. “The increase in tariffs is a blow to the German car industry, which is already in a difficult situation. If this escalates into a new trade war, Germany faces a recession in 2026“, Fust told the Bild newspaper.
For his part, Jens Südekum, an adviser to the German Finance Ministry, recommended waiting. He believes it will first be necessary to determine whether the announced US tariffs will actually be implemented. In that case, he advocated for “adequate retaliatory measures“ by the EU.
On May 1, US President Donald Trump announced that the United States would increase import tariffs on cars and trucks shipped to the US market to 25%, effective next week.