‘Less China, more USA’

Florian Dorn, Economist at the Ifo Institute

Decoupling the EU and Germany from China in the wake of geopolitical disputes would cost the German economy almost six times as much as Brexit, according to an ifo study commissioned by the Bavarian Industry Association (vbw). De-globalization is making us poorer, says study author Florian Dorn. But there are ways to significantly cushion the losses. Felix Lee spoke with the Ifo economist.

Mr. Dorn, according to your study, a trade war with China would cost the Germans almost six times as much as Brexit. The German economy lost around 0.14 percent in economic output in the wake of Brexit. Why do you consider a GDP loss of just under 0.9 percent in the event of a trade war with China to be dramatic?

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