Election in the USA: What does that mean for Saxony's economy?

Election in the USA: What does that mean for Saxony's economy?

Leipzig/Dresden. On November 5, a new president will be elected in the USA, and the effects on the Saxon economy could be enormous! According to China, the United States is the most important trading partner of Saxony, with ten percent of all exports that flow directly into the states. Much of these exports comes from the automotive industry. The question arises: How will the election result affect Saxon companies?

The voters have the choice between Kamala Harris and Donald Trump. While Harris is considered to be a continuation of bidding policy, Trump has already announced that it would reintroduce the punitive tariffs to exports from Saxony that applied during his first term. "Every gram of aluminum and every car part from Saxony could be taxed with ten percent," warns Christoph Schemionek, delegate of the German economy in Washington DC. This could have catastrophic consequences for Saxon companies, since many close profit margins have and the additional costs could significantly reduce profits.

High Customs and its consequences

But that's not all! Trump also pursues an aggressive trade policy towards China. If the United States increases the tariffs to Chinese products, China will probably react to US products with its own customs increases. Dirk Vogel, network manager of the automotive supplier Saxony network, warns: "Production in the USA would become more expensive, which also affects Saxon suppliers." Trump's foreclosure policy could also have devastating consequences for the Saxon automotive industry.

Not to be forgotten are the US companies with subsidiaries in Saxony, such as the semiconductor producer Globalfoundries in Dresden. These companies could invest less, regardless of whether Harris or Trump get power. Both candidates strive to strengthen production in the United States, which could promote the trend towards localization. Despite these uncertainties, Saxon companies are calm because EU economic policy plays a decisive role and the US market remains relevant even after the election.