US tariffs could cost Italy up to 0.8% of GDP

US tariffs could cost Italy up to 0.8% of GDP

The country’s main business lobby said Italy would initially suffer a 0.25% hit this year, with deeper economic effects to follow.

Italy’s main exports to the US include machinery, pharmaceuticals, cars and food products such as olive oil, pasta, cheese and wine. (EPA Images pic)
MILAN:
US tariffs of 30% on EU goods could shave up to 0.8% off Italy’s gross domestic product in 2027, the country’s main business lobby said on Monday, as transatlantic trade negotiations continued.

President Donald Trump has threatened 30% tariffs on EU imports starting Aug 1, but his trade chief Howard Lutnick said on Sunday there was “plenty of room” for an agreement with European counterparts.

If 30% tariffs are confirmed, and assuming no countermeasures from the EU, Italy’s GDP would take a 0.25% hit this year, rising to 0.59% in 2026 and 0.82% in 2027, Confindustria’s research unit said.

Italy’s main exports to the US include machinery, pharmaceuticals, cars and food products such as olive oil, pasta, cheese and wine.

In a separate report, professional services group EY issued even bleaker forecasts, predicting 30% tariffs would shave 1.4% off Italy’s GDP for 2025-2026, effectively cutting to zero expected growth for the period.

Last month, national statistics agency Istat forecast GDP growth of 0.6% this year and 0.8% in 2026.

Italy’s business lobby last week said the only acceptable US tariff would be zero as EU exports are already penalised by a depreciating dollar. The US currency has lost more than 12% against the euro since the start of the year.

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