The Finder | Our monthly Insights | Issue 16 – April, 2025

Issue 16 – April, 2025

The Finder | Our monthly Insights | Issue 16 – April, 2025 

Disruption and diplomacy: the aftershocks of Donald Trump’s 100 days in office and its impacts on Europe

Despite inheriting an already conflictual and tangled international environment, the resumption of the presidency of Donald Trump and his first 100 days in office have added considerable turbulence in international diplomacy, reignited trade conflicts and engendered pervasive economic uncertainty. Longstanding international alliances are being subjected to a process of re-evaluation, resulting in a severe disruption to global diplomacy, whilst the global trade and economic system is experiencing significant strain due to a surge in aggressive tariffs.

Within this context, it is evident that the European Union is facing significant challenges in terms of formulating a comprehensive and united response not only to the US stances, but also to the shifts of the global order which emerged and evolved from the end of the Cold War. In fact, the Old Continent was able to get through from the pandemic, albeit with significant economic challenges, notably evidenced by an average growth rate that was only half of that achieved by the United States, and triggered the debate on the future of the EU economic competitiveness. 

Whilst Germany, unarguably the largest economy in the European Union, has been finalising its government composition, it has also continued to see its manufacturing sector struggling due to rising energy costs as a result of the conflict in Ukraine, weak global demand and the crisis of the automotive sector. Whereas the EU’s single market, designed for commercial entities to access the bloc’s approximately 450 million consumers, has remained fragmented, similarly, in some instances, to the EU foreign and security policy.

Indeed, the international context has behoved the European Union to formulate a comprehensive response to both the new diplomatic and economic shifts, whose impacts are still unknown. Not coincidentally, a recent paper of the European Parliament regarding Europe’s policy options in the face of Trump’s global economic reordering considered a wide range of scenarios on the effects of the new US administration’s stances on Europe, from the imposition of moderate tariffs to the threat of a full-scale trade war. The analysis also included a potential breakdown in multilateral relations, ranging from a potential US withdrawal from the IMF to the possibility of a more collaborative agreement on realigning exchange rates.

As recalled in a recent FT Gideon Rachman’s podcast, trade wars have often anticipated a worsening of diplomatic relations. However, instead of thinking the unthinkable, it would be better to pay attention to what is actually happening to the global economy and diplomacy, especially in Asia, as well as to how Europe could better adapt to or even take advantage from current developments. Indeed, if, on the one hand, a US-Russia rapprochement has also been functional to make Russia distance itself from China, on the other the new US administration’s stances have even “created a powerful incentive for closer ties between China and the European Union”, according to some commentators.  

Furthermore, although globalisation has unarguably been put into strain, it will probably mutate its form during time, as it would be difficult, if not impossible, to reverse such an epochal process in a short period of time. For this reason, Europe should examine the diverse perspectives on US-China relations and how it can navigate not only conflictual relations, but also the changing geopolitical and geoeconomic landscape.   

In geopolitical terms, Europe is walking a tight rope. Having been de facto excluded from the American-Russian-Ukrainian talks on a possible resolution of the war – or at least a long-term truce – the European Union has renewed its efforts to enhance defense capabilities and prepare for a potential deployment of European troops with the aim to prevent Russia from breaching a future ceasefire and to help Ukraine rebuild its military. Nevertheless, the idea of sending European peacekeepers – or a so-called “European reassurance force” – has been reckoned as a viable option, particularly in terms of providing guarantees to Kyiv, as well as a risky one, given the potential for a highly undesirable direct confrontation with Russia.

In economic terms, the European Union could nonetheless maintain the ability to trade freely with the rest of the world, as economist Paul De Grauwe stated. “If we manage to do so, the US will be an isolated protectionist bastion … leading to inefficiencies and high prices for industrial goods. Usually what happens when you have a crisis is it creates opportunities”, he stated. The economist also added that “if you detect it early enough and jump on it, you can change the crisis into something that in the end has favourable effects”. In fact, it has emerged that the new US administration stances are not having the desired effects and could be detrimental for the American economy. However, without a united, comprehensive and consistent response, Europe is, to date, unlikely positioned to seize its chance of glory.

A CER Insight analysed the second Trump presidency and concluded that, in general, it is causing significant changes to the geopolitical landscape, with negative consequences, although some aspects are also beneficial. Despite having taken office for less than three months, Trump’s statements and decisions have already caused significant upheavals in global politics. Charles Grant argues that it is reasonable to hypothesise that many of these shifts may prove enduring: hence, it is unrealistic to assume that circumstances will revert to ‘normal’ after the conclusion of Trump’s term, as he and his supporters represent a significant movement within the American society. The author’s assessment of the return indicates that there have been seven adverse effects and three beneficial outcomes.

Despite the considerable shifts that have occurred within the American society and in light of the presidential election, which unequivocally demonstrated that Trump emerged as America’s preferred candidate, it is noteworthy that, during his initial 100 days in office, Trump experienced a substantial decline in his approval rating, marking one of the lowest points for any US president in recent decades. As Nancy Qian, Professor of Economics at Northwestern University, asserts in a Project Syndicate Commentary, even the most generous interpretation of the Trump administration’s reasoning for initiating a global trade war proves the policy to be deeply flawed. It is evident that the argument under discussion is not rooted in empirical evidence or economic principles, but rather in a series of assumptions that rapidly dissipate when subjected to scrutiny.

On the question of how Europe should regain influence on the US-Russia talks on Ukraine, an ECFR Commentary from Marie Dumoulin argues that, although European policymakers may not have much influence over Moscow or Washington, they can still apply certain tools to influence discussions about Ukraine’s future, all whilst prioritising the EU’s own interests. The author posits that, in order to achieve this objective, the European Union should consider the implementation of a range of diplomatic measures, including sanctions, security guarantees and the prospect of EU integration. The purpose of this would be to exert its influence over the negotiations, ensure that Ukraine has a range of options at its disposal, limit Russia’s influence and be willing to disrupt talks in order to guide the parties towards outcomes that are favourable to Ukraine.

Regarding Europe’s capacity to act in the global arena, a SWP Commentary contends that the issue of limited capacity for action on external relations remains a salient concern for Europe, and that the securitisation process of the EU and its neighbourhood cannot resolve the EU’s decision-making impasse. The authors elaborate on the fact that, since Russia’s invasion of Ukraine in February 2022, there has been an increasing merging of the EU’s Common Foreign and Security Policy (CFSP) with its Common Security and Defence Policy (CSDP). Nevertheless, this process has not addressed the EU’s lack of capacity in foreign and security policy. Two options for improvement are proposed: Europeanising the European pillar in NATO, or communitarising the CFSP and CSDP.

On a similar note, the long-standing question of the EU decision-making processes and, by extension, its unlikely reform, is examined in a CEPS Explainer. The authors explain that the European Council is renowned for its strategic function in managing crises and establishing agendas. However, its influence in the realm of quotidian law-making remains underappreciated. Indeed, the European Council has been found to mention approximately 20% of laws, especially those involving financial redistribution, expansion of EU powers or response to crises. The institution has been observed to exert significant influence over the legislative process, extending it even to laws that do not align with the European Commission’s agenda. This process, the authors conclude, highlights the pivotal function of national leaders in both summits and the law-making process.

Regarding the possible evolutions of the European politico-diplomatic landscape, an Ifri Publication highlights the possible impacts of Germany’s elections on the future of both Transatlantic and Franco-German relations. Marie Krpata notes that, with the formation of a new government under the lead of Chancellor Friedrich Merz, Germany is looking to restore a sense of stability. At the same time, it must define its role within the European Union and clarify its approach to the United States, in light of Donald Trump’s return to the presidency. The author also argues that, at a time when the next few years will be crucial for affirming Europe’s role in the world order and ensuring its security, the future German government faces a choice between presenting itself as firmly pro-European or focusing primarily on defending national interests. She also noted that a new Franco-German dynamic could emerge, shaped by how Germany positions itself in relation to European integration and cooperation.

Regarding the question of defence, a Finabel Publication acknowledges that the Russian invasion of Ukraine has highlighted the importance of long-range capabilities in modern conflicts. The paper begins with an overview of the initial missile capabilities of both Ukraine and Russia, as well as of the Western policy of supplying Ukraine. It then examines Ukraine’s efforts to develop its own long-range munitions in order to conduct a more independent strategic interdiction campaign against Russia and strengthen its long-term deterrence. The study also examines the potential impact of these developments on future European missile capabilities, particularly in light of the growing uncertainty in the security environment and the declining role of the United States in European defence.

On the topic of green industrialisation in an age of disruption in Africa, Europe and the rest of the world, an ECDPM Guide notes that Africa and the European Union have different but complementary priorities in the green sector, offering potential for collaboration. Europe’s energy security and industrial strength hinge on decarbonisation and reliable partnerships in green technology. Meanwhile, Africa’s path to industrialisation depends on access to regional and global markets, as well as on major reforms in international financing to support green energy and industrial development. The research examines how African economies can pursue green industrialisation amid shifting trade patterns and global economic dynamics, focusing on links to regional integration, international financing and worldwide decarbonisation efforts. 

Last but not least, a Clingendael Policy Paper underscores that the European Union’s Global Gateway initiative is at a crucial juncture, with growing demands to expand its influence and improve its offerings to global partners. The Digital pillar of the Global Gateway is still in its early stages, with only 6 out of 46 flagship projects for 2025 centred on digital (hard) infrastructure. By relying on the expertise of EU Member States, there is an opportunity to enhance this pillar and better address the needs of global partners, the authors argue.

This editorial is authored by Massimiliano Gobbato, Communications Director. Contributions by PubAffairs Communications Team’s Nicole Finucci, Kristina Vilenica and Jacopo Bosica to the drafting of ‘The Finder’ are gratefully acknowledged. 

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