EU braces for $1 billion in custom costs as Sino-US trade spat metastasizes


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EU braces for $1 billion in custom costs as Sino-US trade spat metastasizes

On Friday, the 9th of August 2019, an analysis conducted by IfW institute of Kiel, an independent, non-profit economic research institution, based on ‎Kiel, Schleswig-Holstein, Germany, had revealed that a yearlong trade dispute between Washington and Beijing had begun to brew a baleful outcome for other countries, while the European Union, a 28-nation pact of European countries excluding Britain, alone would be stomaching an additional customs fee what could be worth billions of euros.

Aside from impacts of a Sino-US trade row over EU economy, the independent research of IfW institute of Kiel revealed later last week that Beijing would become more vulnerable to direct damages, as the world’s second-largest economy was more exposed to global supply chains in contrast to the United States.

Citing that suppliers of US and Chinese companies might be asked for a lower profit margin to grapple with added tariffs, the IfW institute of Kiel analysis said, “Indirect effects of the trade war arise mainly because products with import duties in the US or China are processed as intermediate products,” while addressing to a growing grudge among suppliers and consumers who had more to lose, a IfW expert Holger Görg noted, “The strong interconnections in international supply chains are also affecting them and they have to incur significant additional costs. ”