Prague – American President Donald Trump has announced a thirty percent tariff on the export of European goods to the United States starting in August, a move that is expected to hinder the growth of the Czech economy, according to Petr Fiala (ODS) and various analysts. Fiala remains optimistic about the possibility of a mutually beneficial agreement between Europe and the U.S., although he warns that Europe should prepare for an unfavorable outcome. He predicts the tariffs could impact the domestic economy by several tenths of a percentage point of GDP, while analysts anticipate a more considerable effect of about one percentage point. The situation remains unpredictable, especially with potential retaliatory tariffs from the European Union.
Should these tariffs come into effect, chief economist of Trinity Bank Lukáš Kovanda forecasts a negative impact on the Czech Republic’s economic growth of 0.8 percentage points for the year. Analyst Dominik Rusinek from ČSOB estimates a possible range of impact between half a percentage point and two percentage points. Analyst Tereza Krček from Reiffeisenbank pointed out that American consumers will also bear the brunt of these tariffs through higher prices for goods.
Krček noted that there are already existing U.S. tariffs of 25 percent on European car exports and auto parts, and 50 percent on steel and aluminum. Expert Petr Knap from EY mentioned that car manufacturers have thus far absorbed these costs, resulting in a relatively modest decrease in U.S. demand. However, he warned that this situation is unsustainable in the long run, and prices will inevitably rise, particularly in the 25 to 30 percent range. “This will lead to a decline in demand and prompt manufacturers to either relocate production of certain models to local U.S. factories or activate additional plants, resulting in reduced demand for supplies from Europe and the Czech Republic,” Knap stated.
A study by Quantic Financial Solutions involving 9,000 Czech firms found that while the Czech automotive and chemical sectors are at greater risk from U.S. tariffs implemented in 2025, sectors such as engineering, construction, and consumer goods show resilience even under tariffs of 15 to 25 percent. “The analysis indicates that the Czech economy has robust foundations, and sectors like engineering present appealing opportunities for investors, even amid uncertainties,” remarked Viktor Jelínek, one of the study’s authors. (July 14)
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