Wait! Wait!
Before you bust out into side splitting laughter I am not talking about what he is doing in this country which could NEVER be misidentified as unity but rather what is happening in Europe.
No my friends I have not partaken in the mushroom thing or hit the Irish whisky a bit too hard today.
As countries across the globe rewrite their trade rule books following the uncertainty posed by US tariffs, a new strategic report predicts that US President Donald Trump’s policies are just the medicine that the European Union needs to become a true single market, fuelling growth, productivity, and profits over the long term.
Although Europe won’t avoid a recession, coordinated fiscal support, likely monetary policy easing from the European Central Bank (ECB), and a renewed integration push “will soften the blow and boost long-term growth”. That’s according to a report by investment research company BCA, called ‘Trump The Unifier’.
“Ironically, Trump is doing more to advance European unity than anyone since Schumann, Monnet, and Adenauer,” Mathieu Savary, BCA’s Chief European Strategist, noted.
Despite the temporary 90-day pause on the 20% tariffs hitting EU goods exports to the US, BCA said a recession is definitely on the cards.
According to the report, the eurozone economy is plagued with uncertainty, weakening business confidence and deteriorating capital expenditure. These challenges arrive at a time when the region is already struggling, with GDP only growing a modest 0.1% in the final three months of 2024.
Tariffs and uncertainty are expected to push an already fragile economy into contraction for at least for two consecutive quarters around mid-2025.
The European Commission estimated tariffs could wipe out 0.2% of eurozone GDP by 2027. In a more severe scenario, if tariffs are permanent or if there are sustained countermeasures, this hit count amount to 0.5%-0.6% in three years’ time.
Could Trump and his moronic economic games be a godsend to Europe and the hope of some unity?
Europe is at a crossroads: suffer continued decline, which Draghi labels “a slow agony,” or regain its former status as a global power. One of the biggest obstacles will be to convince the different member states, including their publics, to take on the challenge. Draghi and others advocate for increasing the EU budget to prioritize large-scale investment projects such as digitization and issuing “common assets” bonds. However, countries like France, which has always seen the EU budget support for agriculture as untouchable, as well as Germany and the Netherlands, which are wary of taking on more EU debt, could be against both of these ideas.
European publics could be even more intractable when it comes to making the sacrifices required to reignite the continent’s economy. France’s much-needed pension reform has been so unpopular that it has effectively disabled the Macron presidency. Across Europe, as in the United States, the popularity of right-wing and populist anti-EU parties is growing. In France’s parliamentary elections, France’s far-right Rassemblement National (RN) won almost double the number of votes gained by Macron’s centrist National Renaissance party. In Germany, Chancellor Olaf Scholz “saw his Social Democratic Party forced into third place behind the Alternative for Germany (AfD), a far-right party. Overall, right-leaning parties in Germany took more than 45 percent of the vote.” More recently, Germany’s far-right AfD claimed its biggest electoral success since World War II, winning a regional vote in Thuringia and coming second in Saxony, two eastern German states. More years of slow growth and belt-tightening could increase public support for anti-EU populism.
I hope Europe finds a way to use the Trump stupidity against him and locate the unity they truly deserve.
I would like to hear from my readers in Europe about this possibility.
I Read, I Write, You Know
“lego ergo scribo”