The United States and Germany are both open economies that
have improved each other’s over all well being over the past centuries. Germany
is the world’s fifth largest economy and the largest in Europe, producing one
fifth of the European Union’s GDP. Not only this, but Germany has developed so
much over the years that it has made itself to be the largest European trade
and investment partner of the United States. The safety and functions of the
German economy, as well as its methods of contributing to the international
economic policy issues are of  high importance
to the United States as well as to the rest of Europe. Unfortunately, the US is
by far the most protectionists when it comes to global trade. The US political
system has gone through much turmoil the past years and is now threatening to
become a single protectionist market, leaving all of its allies in danger. This
change would cause tremendous disasters in international trade, resulting in extensive
losses in GDP for both the US and Germany.

protectionist trade policy limits the unfair competition from foreign
industries, with the hopeful results that imported products will be replaced by
domestic goods and services. The countries in favor of the protectionist US
trade policy are expecting an increase in domestic production, employment and
income in throughout the country. However, this is a wrong assumption to make,
as the results of this theory will, reduce domestic GDP and employment.

We Will Write a Custom Essay Specifically
For You For Only $13.90/page!

order now

Protectionism include  two main elements
of trade – one being the discrimination of foreign economic operators and the
second being the trade restrictiveness. Since the election of US president
Donald Trump, the US trade policy is threatening to become more and more
protectionist. As of 2009, the US has passed 1,297 economic or trade measures
which are considered to be dangerous to the running  of global trade.

            With the
help of the United States to rebuild much of Germany after WWII, the tight
bonds between the two countries came to be. Nevertheless, as years pass by, German-American
collaboration in security matters international political, and economic is
critical in our countries’ continual wealth to the stabilization of the global
system. When looking at political aspects, Germany has many kep leadership
roles while being members of the G-7, G-20, and the North Atlantic Treaty Organization,
also known as NATO, The European Union, the Organization on Security and the
Cooperation in Europe. One of the main tactics and goals both countries provide
their citizens includes the preservation of peace and freedom. The economic
ties between the two countries are based on the dynamic growth of trade and
investment over the centuries. Germany is the largest European economy. This in
hand, assisted in the development over one million jobs n both sides of the
Atlantic Ocean. It is very important to upkeep the robust trade relationship
based on values.

            The United
States and Germany have maintained a strong cultural tie, with thousands of
Americans residing in Germany, and vice versa. In 2015, the United States
became Germany’s fourth largest supplier of goods and the U.S. became Germanys
leading export market. Germany exported goods worth more than $125 billion to
the United States and the U.S. exports to Germany totaled $50 billion.  As Germany holds rotating presidency of the
G-20 group of the world’s biggest developed an developing countries, advocates
an order of free and open trade based on the jointly agreed rules by the World
Trade Organization.

            Between the
years 2007 and 2010, the total GDP of Europe decreased, however, the main expectation
to the GDP decline in Europe was Germany, who’s 3.6 percent growth rate outpaced
all economies. German exports to the United States jumped 8 percent on the year
in the first quarter of 2017, which signals that bilateral trade is
flourishing, even though U.S. President Trump’s protectionist rhetoric. In
2017, U.S. trade in goods with Germany’s exports summed up to be 46,606..5
million dollars compared to 38,183 million dollars in 2005. This shows us that
the trade relationship between the two countries is striving yearly. When
taking a look at Germany’s history, post-war West Germany, up to the mid 1990s
registered an impressive economic performance. However, beginning in the mid
1990s, until the year 2005, unemployment rose that have been exacerbated by a
steep 5% decline in the German GDP growth. This makes the US raise questions
about the long-term vitality and strength of the German economy. As German’s
generous social security and welfare programs have been growing, the United
States has been thinking of cutting Germany off.  A prosperous German state remains critical to
both the U.S. and European economies.

            Due to
these facts, the US is threatening with protectionism. Apart from the
replacement necessities of foreign goods, which Germany has been bringing in,
the inflation rate will rise, with a decline of exports, GDP, employment and
income in the US. Apart from the negative impact on American competitiveness,
rising inflation has another growth dampening effect – higher prices reduce the
purchasing power of American consumers, which therefor demand for goods and
services America decreases.  This will
also result in an additional reduction of employment and income.

            The one who
will suffer the most from the US protectionism depends on the extent of
protectionism and the reactions of those countries who are affected by the
higher customs duties and other barriers to trade. Germany, as well as other
countries like the United Kingdom, will have an annual loss around $12
billion.  It is unclear whether the US
government will implement the announced protectionist measures. However, if the
US should increase trade barriers against goods and services from Germany, then
European economies need new trading partners. 
This all in hand is a wake up call for promoting the European single
market and establishing the European union. 


I'm Erica!

Would you like to get a custom essay? How about receiving a customized one?

Check it out