In the court of macroeconomic questions,
Gentlemen of the jury, when attacked, should the French empire counterattack? The day after his inauguration, Donald Trump launched into an economic diatribe against the European Union. The new American president thus declared that Europe was “very bad for the United States” and “nasty”, before warning that European countries will soon be subject to an increase in customs duties, “the only way” for the United States “to be treated properly.”
France will then not be able to respond in isolation, as the general counsel for this trial, Marie Fernet, lawyer and doctor of law, points out: “France cannot act alone in matters of customs response. This competence falls exclusively to the European Union, which collectively decides on the measures to be taken, in particular customs surcharges, in response to actions deemed unfair or contrary to the rules of the World Trade Organization. Clarification made, should Europe retaliate and in turn impose customs duties on products Made in the USA? I call the defense to the stand.
NO, let's stay calm and don't make the situation worse
Your honor, just because our neighbor does something stupid doesn't mean we have to repeat it. Yes, stupidity! According to Sylvain Bersinger, economist at the Asteres firm, “the idea of counterattacking seems to me to be a bad calculation on the economic balance sheet. » Thus, the massive increase in customs duties promised by Donald Trump is criticized by many experts for the negative consequences it could have on the American economy, in particular inflation (we talk about it here). And that's not all. “By increasing customs duties, the dollar is revalued against other currencies. Which makes American products more expensive on the international market, and therefore less competitive… particularly compared to European products,” recalls our specialist.
You will have understood, Sylvain Bersinger leans towards the rounded back: “Whatever the country opposite and its customs duties, however offensive the 'adversary' Nation may be, we do not emerge victorious by increasing our customs duties . It's ego more than good calculation. »
Especially since according to the Civil Code article 4 paragraph 3, comparison is not right. “Our situation is not that of the United States,” recalls Sylvain Bersinger. Unlike Washington, which has an astronomical trade deficit of 770 billion dollars, the European Union has a trade surplus of 20.9 billion euros. Not spectacular, of course, but enough to say that increasing customs duties and provoking knee-jerk reactions elsewhere is not in our interest. The situation is even worse if we focus on the specific EU-United States case, since the Twenty-Seven sell $157 billion more products than they buy in the United States.
In summary, let the Americans make their (bad) choices. The toad's tax does not reach the white dove.
-YES, let's go ahead and attack America in turn
Certainly, Sylvie Mattely, economist and director of the Jacques Delors Institute, admits: “Increasing customs duties is like shooting yourself in the foot.” But “by increasing their customs duties, the Americans are already shooting us. » Can we stand by and do nothing, Your Honor? Especially since the EU has what it takes to engage in a standoff. “It is a single market of 450 million consumers, enough to hurt any economy, even the United States.” As has been said, Washington imports less than it buys on the Old continent, but the United States still sells 350 billion euros worth of products each year to the European Union. Enough to not appreciate an increase in the price of entry into the market.
A similar scenario took place during Donald Trump's first term, with the United States applying taxes on aluminum and European steel. Reaction in a few months from the EU, which itself had increased customs duties on certain US products. The standoff allowed a moratorium, during Joe Biden's mandate, on customs duties from both camps.
However, everything is not perfect, intervenes our general advocate Marie Fernet: “European exports of steel and aluminum are subject to quotas. Regarding the more than fifteen-year-old dispute between Airbus and Boeing, in 2021, Washington and Brussels suspended the resulting reciprocal tariffs. But as for steel and aluminum, the exemption is temporary and must be renewed after five years. »
Another standoff was observed between the United States and China, each overtaxing the other to the point of concluding a trade agreement, recalls Sylvie Mattely.
“We must not let this happen, otherwise Donald Trump will go into overkill. We cannot be passive,” believes the expert. Who reminds us: the United States does not respect WTO rules. In short, gentlemen and ladies of the jury, we must live with the times. “Today, we are in the post-multilateralism era, where everyone grants themselves what the other grants them. We must therefore have a clear answer. »
The conclusion of the general advocate, Marie Fernet:
« France's interest depends on the nature of the products concerned and their strategic sectors. An economic response may prove necessary to defend the interests of French companies and maintain a commercial balance. The French position is generally aligned with that of the EU, which favors a balance between firmness and dialogue, in order not to compromise transatlantic relations while protecting its industries. » »
