US-EU trade deal will result in loss of up to 2.37 billion euros in sales for companies in Spain

The United States is close to reaching an agreement with the European Union amid the trade war unleashed by Donald Trump since his arrival at the White House. Europe acts as a single bloc when negotiating with the US president, but each country will suffer different economic consequences depending on the volume of exports to the US and the best-selling products. In Spain, the impact will be "limited" in comparison with other EU partners such as France and Germany due to less exposure, but it will still be significant. The latest calculations done by Spain's chamber of commerce reveal that the entry into force of a generalised 15% tariff on exports to the US could cause a drop in sales of between 7.2% and 13.1%. In monetary terms, this means a reduction of up to 2.37 billion euros in total Spanish exports to the US in 2024.

In 2024 Spain exported a total of nearly 18.18 billion euros to the US, or 4.7% of its total global sales, but the country represents much more than that. Around 1,000 Spanish companies account for almost 90% of all Spanish exports to the US. These are companies that will have to start looking elsewhere across the world to channel the thousands of euros that they sell to the US every year and that may now be frustrated by the price increases that a 15% tariff will entail, compared to the effective rate of 2.84% that existed before the trade war, according to data from Spain's Ministry of Trade and Commerce.

The impact, therefore, will be significant in sectors with greater exposure to the US market, such as capital goods (for instance, heavy machinery, tractors, turbines and industrial robots), semi-manufactured goods and the agri-food sector (especially olive oil and wine). Each product will be affected differently because, until now, each category was taxed at a different rate. For example, foodstuffs had an average tariff of 7.45%, so increasing it to 15% will not result in as sharp an increase in product prices as in other sectors with lower rates until now, resulting in a 4% drop in sales (approximately 145 million euros less). This is the situation for the machinery and mechanical equipment sector, which had a rate of 1.09% until last year. So, a 15% tariff will reduce sales by up to 22.7% (approximately 912 million euros), according to estimates from the Spanish chamber of commerce.

The agreement, if signed in the coming days, is not beneficial to any of the players, according to Fernando Moraleda, former secretary-general for agriculture and currently director of the LLYC Food Office. "The procedure by which the agreement has been reached will not bring anything good for trade, especially in the agri-food sector, to the United States because it does not follow multilateral rules. There is no prior ruling from the World Trade Organization, nor any reflection on what impacts this agreement will have," said Moraleda. For this reason, he asserts that "it doesn't matter whether the final tariff is 15% or 20%, the truly dangerous thing is that the method is the worst possible."

In this regard, the economic expert points out that the categories most or least sold to the United States have not been taken into account, but rather general levies have been established "without sufficient rigour", because each market is not only unique in terms of the types of products, but also in terms of the consumers who buy them.