Trump Tariffs: How Will They Affect Greece – What Concerns the Government

“We will stand behind the measures that the European Union will take (ed. if necessary),” a responsible official from the government’s economic staff told OT, explaining that Greece (like any other European country) cannot act on its own and determine its trade policy, as it is bound by European rules.

At first, the Greek government does not appear particularly concerned about the tariffs, in the sense that “Greek exports to the US slightly exceed 2 billion euros, i.e. a little over 1% of Greek GDP,” according to a government official. Consequently, this figure is not considered to be such that it will be able to create very large shocks to the Greek economy, which is on a growth trajectory.

What is happening in Europe

“Other European countries will have a much bigger problem than Greece,” emphasizes the same executive. It is a fact that Germany, Italy and Ireland have the most to lose from a tough trade tariff policy by the US under Donald Trump, since these countries maintain the largest trade surpluses against the world’s largest economy.

In 2023, Germany exported to America products worth 85.7 billion euros more than it imported from the United States. Italy had a trade surplus of almost 42 billion euros from sales of mechanical equipment, fashion items and accessories, chemicals, pharmaceuticals, agricultural products and beverages. Ireland had a trade surplus of 29.4 billion euros mainly from exports to the United States of pharmaceuticals, chemicals, medical equipment, machinery, perfumes and cosmetics. Greece had a trade surplus of 610.5 million euros, which is mainly food.

Concern about secondary consequences

“What worries us most is the secondary consequences of such a possibility,” he said, pointing to tourism issues for example, if many EU countries were affected by a generalized trade war. The connection is simple: If European countries lose “income” due to tariffs, then this could affect Greek tourism, which relies a lot on Europeans, every year .

However, it is not only that. The already announced imposition of tariffs on China carries the risk of turning their attention to other markets, which Greek export companies also target. “Something like this could hurt our industrial products to a certain extent,” a person familiar with the Greek government’s approach to our country’s export policy told OT.

The question is, then, how these secondary consequences will be dealt with. According to an executive of the government’s economic staff, Greece should continue to do what it has been doing until now: Reducing the investment gap, increasing productivity and increasing competition. "You need investments, a change in the composition of the productive base, an improvement in the workforce and a greater connection of savings with investment products," according to the same executive, who addef that there should be a "shift in the economic agenda," highlighting the need to increase technological products and make Greece an even larger energy exporter.