Business associations see opportunities for Germany in the US-Canada customs dispute

According to business associations, the customs dispute between the USA and Canada offers opportunities for Germany and Europe. “If access to the US market becomes more difficult for Canadian companies, their interest in alternative sales markets is likely to grow,” said Volker Treier, head of foreign trade at the DIHK, to the German Press Agency. “Europe can benefit from this.”

With Canada, the EU already has a basis for further improving economic relations through the CETA trade agreement, said Treier. "Since the agreement came into force provisionally in 2017, trade in goods between the EU and Canada has grown by 76 percent - but the potential is far from being exhausted."

Dirk Jandura, President of the BGA export association, also sees opportunities for more trade with Canada. “We are actually already seeing the first clear signs that Canada is gearing its exports more towards markets outside the USA.” According to Statistics Canada, Canadian exports to countries outside the United States rose for the third month in a row in July, reaching a record high of 25.6 billion Canadian dollars (about 15.9 billion euros). “Germany was one of the most important target countries.”

The recent escalation in the customs dispute is likely to reinforce the trend, says Jandura. Canada has so far played a relatively small role in German foreign trade. “Therefore there is significant growth potential.”

DIHK foreign trade head Treier points out that the customs escalation is also putting a strain on German companies with branches in North America. He advocates strategically developing relations with Canada. “This is about much more than trade: Europe and Canada are close partners in innovation, critical raw materials, economic security and resilient value chains.”

In the customs dispute with Canada, the USA has announced import bans on certain products from the neighboring country. Some dairy products, alcoholic beverages and motorcycles will no longer be allowed to enter the United States from September 29, according to executive orders from President Donald Trump.

Canadian counter-tariffs on US imports had already come into force on Tuesday night. Products affected include steel and aluminum, household appliances, agricultural equipment, pulp and paper and electronics. This involves up to 50 percent being added to US imports. Trade talks between the USA and Canada had previously failed.