President Donald Trump’s return to the White House presents a complex matrix of challenges and opportunities for European global leadership, fundamentally reshaping transatlantic relations and international governance structures.
As the European Union navigates this transition, both risks and strategic opportunities emerge across multiple policy domains, according to experts in a Jan. 13 panel organized by the Centre for European Policy Studies, a leading think tank in Brussels. The following are key takeaways from the event.
Realigning trade relations: New battlegrounds and opportunities
Trump’s proposed global tariffs of 10-20% signify significant disruption to international trade architecture. European markets face a double economic threat under the proposed tariff regime: direct export barriers to the U.S. market, coupled with the risk of trade diversion as Chinese products seek alternative destinations. However, this disruption also creates opportunities for new trade alignments. As Matthieu Coget, an advisor on EU public policy and trade notes, the EU may explore “smaller trade agreements or informal ‘packages’ with the U.S. as part of a negotiated tariff truce.”
Climate leadership: Europe’s moment to step forward
With Trump’s expected withdrawal from climate commitments, Europe faces a pivotal moment in environmental leadership. “The only structural solution to the EU’s high energy price problem is the green transition,” says Simone Tagliapietra a Senior fellow at the Bruegel think tank. This vacuum in American leadership presents Europe with an opportunity to not only accelerate but strengthen its position in clean technology markets and global climate governance.
Technology and digital sovereignty: Navigating new realities
The digital domain presents unique challenges and opportunities. While the likely dismantling of the U.S.-EU Trade and Technology Council poses immediate challenges, it also accelerates European digital autonomy initiatives. As Bart Szewczyk, EU digital policy expert notes, “The EU may continue to hope for autonomy and tech sovereignty, but it will face the harsh reality of a potential trade-off between these political impulses and the economic objectives of prosperity and competitiveness.”
Defense and security: Catalyst for European integration
Trump’s anticipated NATO stance might serve as a catalyst for European defense integration. “This pressure could drive EU legislative initiatives such as the development of an internal market for the defense industry, increased production of advanced technologies, and joint procurements,” notes a senior defense analyst at Global Policy watch. This can potentially accelerate long-delayed reforms in European security structures.
Global south relations: A critical strategic imperative
The shifting global landscape presents an opportunity for Europe to rebuild relationships with developing nations. Guillaume Duval observes that current tensions stem from “Europe’s ‘Fortress Europe’ approach to migration, its hesitance to reform international financial institutions… to grant the ‘global South’ greater representation.” This recognition opens possibilities for strategic realignment and enhanced cooperation.
Chinese influence: Competition and coexistence
Beijing’s expanding global role requires careful navigation. Chinese initiatives seek to “reshape the United Nations (UN), pushing its own international initiatives, and setting the terms and material conditions by which emerging technologies and supply chains are governed,” states William Matthews, a senior research fellow at the Chatham House think tank. “This creates both competitive challenges and opportunities for selective cooperation in areas of mutual interest.”
Economic resilience and industrial strategy
Trump’s policies may accelerate European industrial transformation. “The EU must push ahead with its own domestic decarbonization agenda, leading by example at the global level,” states Cecilia Trasi, a research analyst at Bruegel think tank. This necessity drives innovation in critical sectors while enhancing economic security.
Strategic autonomy: From concept to reality
The coming years will test Europe’s capacity for strategic autonomy across multiple domains. As Paul De Grauwe a Belgian economist and professor at London School of Economics notes, success requires “overcoming political divisions and uniting around the objective of pursuing decarbonization while boosting industrial competitiveness and increasing the continent’s security.”
Forward path: Opportunities amid disruption
While Trump’s return presents significant challenges, it also creates opportunities for European leadership in shaping global governance. The key lies in maintaining multilateral principles while developing autonomous capabilities in strategic sectors. This balance between principle and pragmatism will define Europe’s global role in the coming decades. The challenge of Trump’s second term demands decisive European action. The analysis is unequivocal—fragmentation and indecision must give way to a unified European purpose, particularly in balancing climate objectives with industrial strength and security concerns.
