For Europeans and even for a good part of the rest of the world, the election of Donald Trump and the future implementation of his “America First” program does not bode well.
Donald Trump promised during his election campaign to raise customs duties and introduce import taxes of 60% on Chinese products and 10% for the rest of the world. This would cost the European Union economy $533 billion by 2029, the United States $749 billion and China $827 billion, international consultancy Roland Berger estimated in a study that also takes into account probable retaliatory measures that the European Union and Beijing would take. Emerging countries such as India, Indonesia and Brazil”would be much less affected“, according to a study by the London School of Economics.
Overall, the economic war that Donald Trump promises to wage against China risks slowing down global growth. The International Monetary Fund (IMF) has already sounded the alarm on this subject.
For Europe too, the future will not be rosy if Donald Trump goes through with what he has planned to introduce in terms of customs duties. “Very clearly, this administration will be even more protectionist than the Biden administration which already was. And so this will have serious consequences, among others on the European industry which will further lose market share in the United States.“, analyzes Eric Dor, director of economic studies at the IESEG School of management at the Catholic University of Lille. In summary, we should expect a reduction in exports of goods from the European Union to the United States As Chinese companies are hit with high customs duties in the USA, we must also fear that they will intensify their efforts to conquer the European market. European companies would thus lose further market share in Europe to the benefit of China.
Another measure by Donald Trump which risks accentuating the effects of protectionism: his desire to relaunch drilling and the extraction of shale gas and oil by hydraulic fracturing. This would be done with the aim of reducing the cost of energy in the United States, for the benefit, among others, of American companies. “This means that it will further widen the abysmal gap between the very low cost of energy in the United States and the very high cost of energy in Europe since we lost the cheap supply from from Russia“, explains Eric Dor. And to fear that the deindustrialization of Europe will increase. “There is already deindustrialization that has started in Europe because of this (editor’s note, the increase in the cost of energy). Many very energy-intensive industries are leaving Germany and other European countries to settle, for example in the United States and supply Europe from there.“, selon Eric Dor.
Belgium
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