DRESDEN (dpa-AFX) — Of all cities, districts, and counties in Germany, Salzgitter suffers the most from U.S. tariffs. According to calculations by the Dresden branch of the Ifo Institute, 1.16 percent of the region's gross value added is lost as a result. However, there are also beneficiaries — most notably Potsdam, which sees a gain of 0.23 percent.

Ultimately, the local economic structure is decisive, says the Ifo Institute. "While service providers tend to benefit and gain market share in many places, losses in manufacturing are severe in certain districts," explains Robert Lehmann, one of the study's authors. "Overall, the tariffs could, in the medium term, lead to a shift in economic activity from industry to services."

Metal and Automotive Regions Bear the Brunt

The authors attribute Salzgitter's status as the hardest-hit region to its specialization in metal production. The next four districts and cities with the largest declines are all characterized by a strong automotive industry.

In Dingolfing-Landau, Bavaria, home to Europe's largest BMW plant, Ifo researchers expect a decline of 1.08 percent. In Wolfsburg, Lower Saxony — the headquarters of Volkswagen — they forecast a drop of 1.06 percent. Böblingen in Baden-Württemberg, which hosts the large Mercedes plant in Sindelfingen, is projected to lose 1.05 percent, while Ingolstadt, Bavaria, home to Audi, is expected to see a 0.98 percent decrease.

Beyond Potsdam, the economists calculated the strongest positive effects for Main-Taunus-Kreis with a 0.22 percent increase, Cottbus with 0.18 percent, and Bonn with 0.17 percent.

Northeast Fares Better

Overall, the researchers predict a gradient from northeast to southwest. In Schleswig-Holstein, Mecklenburg-Western Pomerania, and Brandenburg, they see some districts and cities with slightly rising value added and generally lower declines. In the west and south, however, there are only a few positive exceptions.

Still, the number of districts, counties, and cities with negative impacts far outweighs the positive: Only 61 recorded a positive outcome, compared to 339 with a negative result.

Among Germany's four cities with populations over one million, Hamburg is best positioned, with Ifo forecasting a 0.13 percent gain for the Hanseatic city. Berlin could also benefit slightly, with a 0.08 percent increase. Cologne faces a slight negative effect at 0.09 percent, while Munich is expected to experience the most significant decline among the big cities, at 0.18 percent./ruc/DP/stw