Austria Calls for “Made in Europe” as Response to U.S. Tariff Chaos

Transatlantic economic relations are heading for a historic turning point. After months of uncertainty and a landmark ruling by the U.S. Supreme Court, Europe is now also pulling the emergency brake. As the domestic export industry grapples with its weakest year since the pandemic, calls for a radical strategic realignment are growing louder: away from dependence on Washington, toward new markets globally and a strengthened “Made in Europe” identity.

Liberation Day and its consequences

The upheavals began in April 2025 at the latest, when Donald Trump proclaimed his so-called “Liberation Day” and imposed far-reaching tariffs on foreign goods. But the latest bombshell came last Friday from the U.S. Supreme Court. The high court prohibited the president from imposing tariffs solely on the basis of the International Emergency Economic Powers Act (IEEPA).

Amid this legal tug-of-war in Washington, Brussels reacted promptly: the European Parliament postponed ratification of the tariff agreement negotiated in July. This would have provided for the abolition of EU tariffs on U.S. agricultural goods in exchange for a cap on U.S. tariffs on European goods (maximum 15 percent).

“The events of the last few days show once again that trade relations with the U.S. are uncertain. Stopping the tariff deal is now the right response,” said Hattmannsdorfer. Europe must act with confidence and unity, working consistently to become more independent of the United States.

Export shock: Austria loses billions in U.S. business

The urgency of this realignment is underlined by current figures from the Austrian Chamber of Commerce (WKO), which are available exclusively to the daily newspaper Die Presse. The year 2025 marks a severe setback for the domestic export industry due to the slump in exports to the U.S., with exports to the United States falling by a massive 21.4 percent in 2025. This corresponds to a loss of around 3.5 billion euros – a volume roughly equivalent to Austria's entire export market in Romania.

Total exports shrank by 1.2 percent to just under 189 billion euros, and when adjusted for inflation, the figures for 2025 are only slightly above the level of the crisis year 2020.

WKO President Martha Schultz warns of a toxic mix of protectionism, geopolitical tensions, and dwindling competitiveness. “A recovery in exports is no longer as certain as it was in the past,” Schultz said.

Change of strategy: Looking east and “Made in Europe”

As a consequence of Washington's unpredictability, Minister Hattmannsdorfer is calling for a massive acceleration of alternative free trade agreements. The focus must now be on Southeast Asia and the Gulf region. In addition, Austria is pushing for the rapid ratification of agreements already negotiated with India and the Mercosur region in South America.

Another key point of the new strategy is “courage to go Made in Europe.” Hattmannsdorfer advocates a more active industrial policy modeled on China and the U.S., which provides massive support to their key industries. Specifically, he calls for adjustments to state aid and public procurement law: “We must ensure that domestic tax money also strengthens European value creation – and does not finance international competition.”

Hope in the Far East

Despite the gloomy figures for 2025, there are rays of hope. A recent survey of 1,613 foreign subsidiaries of Austrian companies shows a clear trend: while uncertainty prevails in Europe and the U.S., companies in Southeast Asia and the Middle East expect strong growth for 2026.

Whether European unity will hold in the face of Trump's announced new flat-rate tariffs of 10 to 15 percent remains the central question for the coming months. For Austria, one thing is certain: the era of blind reliance on its transatlantic partner is over for the time being.

BMWET