A US tariff of 25% on all EU imports would reduce Dutch GDP over the next two years, according to Rabobank economists.

If the United States spares the EU from tariffs entirely, Dutch GDP growth is expected to reach 1.7% in 2025 and 1.2% in 2026, the bank said in its latest quarterly update. However, if a 25% tariff is imposed across the board, growth would drop to 1.5% and 0.7%.

The United States is the Netherlands’ fourth-largest export market.

Inflation would also rise by an additional 0.4 percentage points in both years, Rabobank said. Without tariffs, the estimates are 3.6% and 3.1% respectively, well above the 2% target.

The researchers assume that Brussels would respond with a similar import tariff and have taken the impact of tariffs on Canada, Mexico, and China into account.

“In the end, the EU is our biggest market,” Rabobank economist Frank van Es told the Financieele Dagblad. “And trade with the US will not come to a complete stop. However, I do want to emphasise that the impact on specific sectors or companies could be significant.”

According to research by ABN Amro, Dutch food exports to the US—worth €2.3 billion in 2023—would be more than halved if a 25% import tariff were fully passed on to customers, the FD said.

Producers of beer and spirits could see their sales more than halved, while fish traders, who primarily export salmon, could face a demand drop of up to 70%. For cocoa and chocolate, exports are expected to decline by 60%.

Last month, Tata Steel said Trump’s plans for a 25% tariff on steel and aluminium imports will impact the company’s IJmuiden operations.

Tata said it is considering “all possible options” should the tariffs take effect, according to news agency ANP.