Viktor Orban announces two plans to counteract the effects of new American customs taxes. What worries him
Viktor Orban, during a visit he made to President Donald Trump at his Mar-A-Lago residence, photo: Zoltan Fischer / AFP / Profimedia Images
The Hungarian government will develop plans to protect the jobs and the country industry after the commercial agreement between the United States and the European Union, said Prime Minister Viktor Orbán on public radio, quoted by Reuters.
The United States and the EU announced on Sunday a commercial agreement providing for a 15% customs duty for the block exports to the US. The tax is applied including cars – a pillar of exports in Central Europe – which were previously subjected to a tax of only 2.5%.
Orbán, a strong supporter of President Donald Trump, said the total Hungary exports to the United States are about $ 11 billion annually.
“We must develop two action plans. The first is a plan to protect jobs, so that foreign companies operating in Hungary do not react by designing employees. Or, if they do, we must offer those people immediately,” said Orbán.
According to him, the second plan is necessary to ensure that no production center is closed as a result of new customs duties. His comments come in the context in which the Budapest government strives to relaunch the Hungarian economy after the most severe inflationary wave in the EU, started during the Covid-19 pandemic and aggravated by the problems created by Russia in Ukraine in 2022.
Orbán, who faces what political analysts say that it will be a very close electoral competition next year, criticized her the president of the European Commission on Monday, Ursula von der Leyen, accusing her of negotiating the agreement.
The new customs taxes imposed by Trump hits Central and Eastern Europe
The Hungarian government did not publish an estimate on the impact of customs taxes on economic growth, although the Ministry of Economy reduced the economic growth forecast for 2025 from 2.5% to only 1%.
Concordia, the largest employer confederation in Romania, estimated that customs duties could reduce the country's economic growth by up to 0.2%. For his part, the Ministry of Finance of the Czech Republic said they will slow down the country's economic expansion by 0.2 percentage points by the end of the year.
For the neighboring Slovakia – which has the highest share of exports of goods in GDP throughout the EU – economists from Société Générale estimated that the impact of customs duties could represent 0.87% of the gross domestic product.
Polish Prime Minister Donald Tusk said Poland, the largest EU economy outside the euro area, could lose about 8 billion zlots ($ 2.14 billion) due to new US import rates.
