MF: Agreement between the EU and the USA will slow down the growth of the Czech GDP by 0.2 points this year
Prague – The trade agreement between the EU and the USA, which includes a flat tariff of fifteen percent, according to a quick rough estimate by the Ministry of Finance (MF), will lead to a slowdown in the growth of the Czech economy this year by 0.2 percentage points and in 2026 by 0.39 points. The MF informed CTK today, stating that the growth of Czech GDP will not automatically slow down due to these estimates.
The negative effect of the tariffs can, according to the MF, be compensated by other factors, such as the improvement in the current development of the Czech economy or the expected positive impacts of the German fiscal package in 2026. The tariffs are set to take effect from Friday, August 1, 2025.
The trade agreement between the union and the United States, the basic framework of which was announced on Sunday by the President of the European Commission Ursula von der Leyen and the American President Donald Trump, introduces a flat tariff of 15 percent on imports of most goods from the EU to the USA. For certain commodities, such as steel or aluminum, an import tariff of 50 percent still applies. Other commodities, such as selected chemicals, pharmaceuticals, or critical raw materials, are completely exempt from tariffs.
The Ministry of Finance is currently preparing the August macroeconomic forecast, which will be presented on Thursday, August 21. “This will already reflect the fifteen percent tariffs; however, since we do not yet know all the individual items that would be exempt from tariffs, this estimate may change before its release,” the ministry stated.
This year, in its April forecast, the MF expected economic growth of two percent after last year’s 1.1 percent. Compared to the January forecast, it has downgraded its outlook by 0.3 percentage points, mainly due to the impact of American tariffs on automobiles, steel, and aluminum. The forecast also took into account the sectoral tariffs as well as the ten percent general tariffs that the USA impose against most countries in the world.
However, it did not account for the twenty percent general tariff against the EU, which Trump announced in early April but later postponed for 90 days. If the general tariffs of 20 percent were in effect, according to the MF’s April forecast, the Czech gross domestic product would increase by 1.6 percent this year. (July 29)
