Foreign trade: Mechanical engineering: barriers complicating global trade

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foreign trade

Mechanical engineering: Restrictions make global trade more difficult

In a mechanical engineering company, a machine cuts a workpiece from a steel plate. Increasing trade barriers make it difficult for European machine and plant manufacturers to do business outside the EU.

Photo: DPA

Technical regulations, customs duties or subsidies restrict free trade worldwide. The export-oriented mechanical engineering gets to feel its effects.

Brussels/Frankfurt. Increasing trade barriers make it difficult for European machine and plant manufacturers to do business outside the European Union (EU).

Gallen on behalf of the Association of German Machine and Plant Manufacturers (VDMA), almost 80 percent of industrial exports worldwide are confronted with customs barriers, state-subsidized competitive products or state export incentives. We do it. from third countries.

VDMA foreign trade manager Ulrich Ackermann said at a presentation of the study in Brussels that the picture was frightening for the entire European industry. “The gradual build-up of trade barriers costs jobs and prosperity.” The EU should do everything possible to secure further free trade agreements, for example with the South American economic alliance MERCOSUR or the Indian states.

Many factors make doing business difficult

According to the study, China-United States disputes, the coronavirus pandemic and national industrial policies have strengthened or rebuilt trade barriers in recent years. By far the largest share (73 percent) is accounted for by the country’s export promotion measures in mechanical and plant engineering. In addition, many local competitors received direct subsidies.

“At the beginning of this year, almost half of all European machine exports to China, India and the United States were affected by subsidy barriers, which manifested themselves in the United States, for example, through direct support measures and government tax breaks. In shape,” explained Ackerman. So-called technical barriers to trade, such as technical regulations, also impede trade. According to the study, the requirements are particularly high in the USA, China, Canada and Brazil. Classic customs plays a subordinate role in mechanical and plant engineering.

However, according to the study, the European Union is also isolating itself from Asia in particular with technical trade barriers. “The sophisticated technical regulation in the EU acts like a trade barrier for machine exporters from third countries,” analyzed Ackermann.

© dpa-infocom, dpa:220622-99-758065/2

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