How Trump’s tariffs hit Spanish exports with three regions at risk

Exports under pressure

by Lorraine Williamson
Spanish exports

Spanish exports face new challenges as Donald Trump’s proposed tariff increases target European goods. While Spain is not among the most vulnerable EU nations, key sectors and regions are poised to feel the impact of these protectionist measures.

The inauguration of the 47th US president reaffirmed Trump’s commitment to raising tariffs on foreign products. These policies are part of his strategy to bolster the US economy by discouraging imports. For Spain, the proposed tariffs represent a direct threat to vital export sectors, including industrial machinery, chemical products, and food.

Regions most affected

Three Spanish regions are particularly exposed to these trade changes:

  • Valencian Community: A key player in agricultural and machinery exports, this region faces challenges due to its reliance on US trade.
  • Andalucia: A major hub for olive oil and other food products, Andalucia’s economy could suffer significantly.
  • Basque Country: Known for its industrial and capital goods exports, this region could be hit hard by increased tariffs on machinery and tools.

Impact on key sectors

Semi-finished products and machinery

Semi-finished goods, including aluminum, steel, and chemicals, make up 26.7% of Spain’s exports, with 1.3% destined for the US. Capital goods, such as machinery and tools, account for 19.5% of Spain’s exports, with 1.6% shipped to the US. Regions like the Valencian Community, Madrid, and the Basque Country are central to these industries.

Food and agriculture

Spain’s food sector, representing 17.5% of total exports, faces significant risks. Andalucia and Catalonia are the leading regions exporting food products to the US. Olive oil sales, in particular, are vulnerable, as previous US tariffs already impacted this sector in 2019.

Chemical products

Catalonia, a stronghold of Spain’s chemical industry, could also face challenges. With chemicals comprising a large share of exports, increased tariffs would directly affect this sector.

Historical context and future risks

In 2019, during Trump’s previous term, the US imposed 25% tariffs on European agricultural products, including Spanish olive oil, wine, and cheese. These measures, backed by the WTO, were part of a broader trade dispute over EU subsidies to Airbus. Since then, trade between Spain and the US has grown, accounting for 4.6% of Spanish GDP by 2023.

Outlook for Spanish trade

As Trump’s administration seeks to implement stricter tariffs, Spanish exporters face mounting challenges. The emphasis on building US domestic industries creates a hostile environment for foreign goods. Regions and sectors heavily reliant on US trade must adapt to avoid long-term economic damage.

Trump’s proposed tariffs pose significant risks for Spain’s export economy, particularly in the Valencian Community, Andalucia, and the Basque Country. Policymakers and industry leaders must explore strategies to mitigate these effects and secure Spain’s position in global trade.

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