South Carolina Gov. Henry McMaster and Germany’s Federal Minister for Economic Affairs and Energy, Brigitte Zypries, stressed on Thursday at the BMW Manufacturing plant in Greer the importance of trade relationships between Germany and the U.S.
Statements in front of state and German media came just a few hours before German newspaper Der Spiegel quoted sources that said President Donald Trump criticized Germany's auto trade surplus in the U.S. to European Union President Jean-Claude Junker Thursday at the NATO summit in Belgium.
BMW Manufacturing is a top employer in the Upstate region, employing around 8,800 people. The German automaker will celebrate its 25th anniversary in late June since BMW Group's official announcement on June 22, 2016, that the German automaker would build its first full manufacturing facility outside of Germany.
The $60 billion company today has invested more than $7.8 billion. The plant produces more than 1,400 vehicles per day.
McMaster took a tour of the BMW plant alongside Zypries, who holds a similar role to U.S. Secretary of Commerce Wilbur Ross, and BMW Manufacturing President and CEO Knudt Flor before stepping into a roundtable discussion with S.C. Commerce Secretary Bobby Hitt to discuss apprenticeship opportunities between the state and Germany.
Asked his take on the border adjustment tax by German media: McMaster didn't elaborate, but said there are positives and negatives, though much of it depends on Trump's administration.
“Republicans, typically, are opposed to taxing more, but … the conservative philosophy also calls for a balanced budget,” McMaster said when asked whether the proposed tax on imports but not exports had a realistic chance. “We’re always it seems on the horns of the dilemma, but we’re trying to make our way through this so it will be the best for the people of our countries, particularly for the people in South Carolina.”
Zypries sincerely differed.
“Well, it’s difficult to have a border adjustment tax, of course, because it starts with production companies and not with the goods which are produced,” she said. “…I think since a workflow in (the) globalized world is a supply chain, where things comes from all over the world and are fixed on one certain point, you can’t really, very good have a border adjustment tax where you pay for everything you bring in, because it makes a product really expensive.”
Reports circulating this week suggest the tax, proposed by U.S. House leadership, has little chance to see light given pushback from fellow House Republicans and Trump's administration.
In South Carolina, there are near 200 German-owned companies.
McMaster said within the past five to six years, South Carolina has exported almost $5 billion in trade to Germany alone.
“The Minister’s presence here emphasizes the fact that South Carolina has entered into the global economy, and that’s good for the people of South Carolina, it’s good for the people of Germany,” McMaster said. “And we look forward to building on our relationship and expanding that relationship in the future.”
Zypries described the relationship between South Carolina and Germany as “very good,” citing by example Flor’s stay in Spartanburg County.
“And he says he’s not leaving,” McMaster exclaimed. “And in President Trump language, I’d say the relationship is 'A' plus.”
Very, very good, Zypier responded.
“That’s right,” the governor said. “Huge.”