Calm, Cool, and United: How can the EU navigate Trump 2.0
Tuesday, 21 January 2024

The return of Donald Trump to the White House, along with his administration’s renewed emphasis on an “America First” agenda, has raised pressing questions for European countries. How should the EU respond to its what used to be its closest ally? On the latest episode of Future is Blue, we explored this evolving dynamic with two distinguished guests: Arancha González Laya, Dean of the Paris School of International Affairs at Sciences Po and former Spanish Foreign Minister, and Raymond Torres, Funcas Europe Director.
You can access the podcast here and listen to it on your favourite platform (Spotify, Apple Podcasts…).
From Ally to Rival
Long time Europe’s most precious ally, Trump’s agenda entails risks of rivalry, rather than cooperation. The U.S. may become and actor that “weaponizes trade to achieve non-economic objectives”, according to Gonzalez Laya. “This is an ally that Europe depends on for global stability, democracy promotion, and counter-terrorism. Yet, it is also a rival weakening European regulations and accessing natural resources at Europe’s expense.”
The risks are obvious for Europe. “The challenge is not just dealing with the U.S., but ensuring Europe doesn’t fragment under intensified pressures,” Torres said. A surge in isolated actions and short-lived measures to protect the interest of individual countries would be counterproductive, so Europe’s response must prioritize cohesion and a unified stance.
A Three-Pronged Strategy
The discussion pivoted to actionable solutions. González Laya proposed a three-pronged strategy for the EU: persuasion, readiness to retaliate, and strengthening internal resilience.
“The best way to persuade is to show we’re prepared to retaliate, if necessary,” she said, emphasizing the importance of unity. “Europe must remain calm, cool, and united.” However, she warned that retaliation is a double-edged sword: “An eye for an eye leaves us all blind.”
Torres stressed the importance of developing Europe’s “own assets” in energy, technology, and defence. “A pan-European energy program, reduced reliance on U.S. tech giants, and a robust defence industry are critical. Without these, Europe cannot hope to counter external pressures effectively,” he argued.
Energy and Defence: Areas for Progress
Both experts identified energy and defence as areas where Europe could achieve tangible results. Torres highlighted the potential for greater energy interconnections and investment in renewables. “These initiatives align with shared European interests,” he said.
On defence, González Laya pointed out the fragmented state of Europe’s defence industry and the need for integration. “Strengthening our defense capabilities will not only enhance security but also drive technological innovation,” she noted.
Strengthening internal EU markets
Another key area of focus is Europe’s internal market. For instance, integrating capital markets is essential for financing energy, technology, and defense initiatives. “Europe is a wealthy continent with poor investment practices,” Spain’s former Foreign Affairs Minister said. “If we don’t leverage our resources, we risk irrelevance.”
Torres underscored this point with striking statistics: “In the first three quarters of 2024, Europe exported nearly €270 billion in savings. These funds, which should be fueling Europe’s productive potential , are instead bolstering third countries, notably the U.S.”
Strengthening Alliances
Looking beyond Europe, it’s essential for the EU to strengthen alliances with regions like Latin America, Africa, and Asia. Agreements like the EU-Mercosur deal are about more than trade. “This is about building alliances that strengthen our collective ability to shape the future,” Gonzalez Laya said, calling for renewed focus on agreements with Chile and Mexico.
Torres added that thematic alliances—such as collaborating with the UK on defence or with China on the green transition—could provide additional leverage. “These partnerships can mitigate the risks posed by Trump’s isolationist promises and amplify Europe’s global influence,” he said.
Multilateralism: Reform or Ruin?
There is a need for reform for institutions like the WTO. González Laya outlined three possible paths: flexibilizing existing rules to keep the U.S. engaged, continuing without the U.S., or facing a global trade conflict.
“A WTO minus the U.S. is not ideal, but it’s preferable to a complete collapse of the system,” she said. Torres highlighted the importance of reforming the system while maintaining its rules-based principles, bringing like-minded partners to the table. “If Europe can lead a coalition to reform the WTO, it may eventually pressure the U.S. to rejoin,” he suggested.
Balancing Cooperation and Rivalry
Balancing trade tensions with the need for U.S. cooperation on security is an enormous challenge for this side of the Atlantic.
“We must be clear: weakening Europe will embolden adversaries like Russia and China. Weakening Europe will weaken the USA … we can disagree on tariffs but must collaborate on fundamental issues like security and counterterrorism”, according to Gonzalez Laya.
Torres echoed this sentiment, noting contradictions within the U.S. approach. “Much of the American business community and investors, particularly in the non-tech sectors, have a vested interest in a strong Europe,” he argued.
Calm, Cool, and United
Whether through internal reform or strategic alliances, the EU’s path forward will require a delicate balance of cooperation and confrontation. Uncertain times call for steady hands and a clear, united strategy. The clock is ticking for Europe to rise to the challenge.
You can access the podcast here.
Carlos Carnicero Urabayen