How is Greece affected by Trump's tariffs? - Direct and indirect effects on the Greek economy
Alpha Bank analysts are investigating the direct and indirect effects that the Trump administration's tariffs could have on the Greek economy.
In particular, the main sectors that could be affected by the imposition of US tariffs are being examined, such as exports, foreign direct investment and tourist flows. Indirect impacts on the Greek economy may also arise as a result of tariff consequences in other European countries.
Direct effects
Regarding direct impacts, there are several channels through which increased trade protectionism could affect the Greek economy.
· Trade balance: Since 2011, with the exception of 2022, during the recent energy crisis, Greece has maintained a trade surplus with the United States, which reached approximately 0.25 billion euros in 2024. In addition, exports to the United States currently represent 1% of Greece's GDP and less than 5% of total exports. More specifically, the country's exports to the US reached 2.4 billion euros in 2024, of which 23% are fossil fuels, followed by food, mainly fruits and vegetables, and industrial products. Vegetables comprise 10.5% of total exports to the US, fruits and nuts (4.4%), cement (3.9%), aluminum products (3.8%), cheese and dairy products (3.1%), and olive oil (3.1%).
Given that Greek exports to the US, on the one hand, constitute a relatively low percentage of the total and, on the other hand, generally do not relate to sectors that will be significantly affected by tariffs (such as the automotive industry, luxury goods), the direct impact of the new US trade policy is not expected to be significant for Athens.
· Foreign Direct Investment: FDI flows from the United States reached 177 million euros in 2024, representing 2.6% of total inflows. Of these, 131 million euros are related to real estate investments. Between 2020-2024, FDI inflows from the United States reached 1.56 billion euros (5.6% of the total), with 565 million euros going to the real estate market.
· Tourist flows: The possible slowdown and/or recession of the US economy due to the negative effects of the tariff policy, combined with the weakening of the dollar against the euro, could lead to a weakening of inbound tourist flows from the US in the short term. The year 2024 was a historic year for the US market, with unprecedented levels of visitor arrivals and tourism revenues in Greece. Arrivals from the United States reached 1.55 million tourists (3.8% of the total), while tourism revenues reached 1.6 billion euros (7.3% of the total, which was the third highest figure after Germany and the United Kingdom).
Indirect impacts
As for indirect impacts, they are estimated to be more significant and will mainly stem from the exposure of Greece's European partners to changes in US trade policy, mainly due to their trade openness and strong interconnections with global supply chains. Some European countries are even more sensitive than others, such as Ireland, Italy and Germany.
Regarding the product categories most exposed to changes in terms of trade, EU exports to the US are three times higher than their respective imports in food, drinks, tobacco and twice as high in manufactured goods, including machinery, transport equipment and chemicals. In contrast, US fuel imports exceed their respective exports by six times, according to Eurostat data in 2024.
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