The consequences of Donald Trump's return to the White House for European companies

The mains issues following Donald Trump's return to the White House

First, let's look at the economic situation in the United States. Despite a seemingly solid economy, the United States displays significant disparities. Growth is enviable, with GDP up 12% on its pre-Covid level. However, problems remain:

• Social inequalities: despite low unemployment, the US remains one of the most unequal countries in the world.

• Economic imbalances: trade deficits continue to widen (to nearly 1,000 billion USD), despite protectionist measures.

• High public debt: the budget deficit has reached 8% of GDP, fuelled by successive stimulus programs.

In addition, Donald Trump's protectionist approach could become more pronounced with stricter customs measures:

• Increased customs duties: A 10% tax on all goods imported into the United States, or even 60% for Chinese products, is being considered. This would raise US tariffs to levels not seen since the 1940s.

• Sectoral impact: The European sectors most at risk are the automotive industry (especially for Germany), pharmaceuticals and agri-food (wine and spirits).

Increased protectionism in the United States could have several consequences for European companies, such as:

• Reduced exports: High tariffs could reduce the competitiveness of European products on the US market.

• Risk of insolvency: Certain sectors, particularly SMEs, could be weakened by a drop in export sales.

• Realignment of strategies: Faced with trade barriers, companies could look for new markets or focus more on Europe.

• Monitoring Chinese overcapacity: the detour of Chinese exports to Europe could intensify competition on the European market.

The European Union will have to be proactive to meet these challenges:

• A common trade policy: Although trade competence lies with Europe, the divergent interests of member states could complicate a coordinated response.

• Defense of strategic sectors: Measures like those advocated by the Draghi report, such as the protection of strategic assets (health, industry, energy), could be strengthened.

Finally, Donald Trump's policies could also alter the geopolitical chessboard:

• Global conflicts: the United States' repositioning vis-à-vis Ukraine, China (Taiwan), or the Middle East could create additional uncertainties for European companies.

• Climate transition: Trump's planned withdrawal from climate agreements would contrast with European environmental ambitions, raising questions about the competitiveness of companies subject to climate constraints.

Donald Trump's return to the White House calls for heightened vigilance on the part of European companies and governments. Faced with a more protectionist American economic policy and an unstable geopolitical context, Europe will have to strengthen its trade strategy, protect its key sectors and consolidate its unity to face these new challenges.