Ingka Group CEO warns of impact from looming Trump tariffs
Jasper Brodin, CEO of Ingka Group, acknowledged that the tariffs the Donald Trump administration plans to introduce soon will negatively impact international trade. "It’s beyond our control. We will need to understand and adapt," Brodin stated.
In a conversation with CNN, Brodin mentioned that tariffs make it challenging to maintain low prices and product availability. "We have never experienced a period of benefit when we had high tariffs," he remarked. The Ingka Group he leads is the largest franchisee of IKEA.
Brodin did not specify whether the company would relocate production to other countries due to the planned introduction of new tariffs by the USA. Currently, about 70% of IKEA's production comes from Europe, and about 30% from Asia, primarily China.
The USA prepares for a trade war
President-elect Donald Trump recently announced that the USA would impose high tariffs on goods imported from China, Mexico, and Canada. The tax rate could be as high as 25 per cent.
Trump explains that the tax will apply until the three mentioned countries stop illegal drug trafficking and the influx of immigrants into the USA.
Economists from Crédit Agricole are confident that the increases will not significantly affect the European economy. "Intermediate goods exported from the European Union are not a crucial component for most production processes in the USA. The United States is also not a major recipient of final products manufactured in the EU," experts highlight.
