This year’s World Economic Forum in Davos coincided with Donald Trump’s inauguration, and while U.S. political representation at the event was minimal, his name dominated nearly every panel discussion. His virtual speech served as the forum’s grand finale, leaving Europeans in an uneasy mood—compounded by economic uncertainty.
A Push for Unity Amid Growing Concerns
As usual, Davos featured ambitious discussions on reducing social inequality, combating global poverty, and tackling climate change. But this time, those topics took a backseat to one pressing issue: how Europe should navigate Trump’s return to the White House. The central theme of the discussions was Europe’s need to assert itself—consolidating its position and crafting a unified strategy to deal with the new political landscape.
So, what exactly is fueling European concerns?
- Defense Spending Demands: Trump insists Europe should fully fund its own defense. In his Davos address, he once again urged European nations to boost defense spending to 5% of GDP. Many EU countries—like Italy—struggle to meet even the longstanding 2% NATO target, making his demand a source of anxiety.
- Energy Policy Conflicts: Trump’s push to expand U.S. energy exports puts Europe’s green agenda in a bind. EU energy prices—already several times higher than in the U.S. due to the Russia-Ukraine war and rapid green transition costs—are making it harder for European companies to compete, particularly in high-tech industries like AI.
- Tariffs and Trade Tensions: Trump’s plan to impose sweeping tariffs poses a major threat to European exporters, already strained by Chinese competition. Germany, in particular, stands to suffer, with its prolonged recession pointing to deeper economic troubles ahead.
Trump-Optimists vs. Trump-Opportunists
Trump appears to be exploiting divisions within the EU, hinting at potential deals not just with the bloc but also with individual European nations. However, Europe remains fragmented—lacking cohesion on trade, security, and economic policy.
European leaders themselves are split. Some see Trump’s return as an opportunity for economic revitalization, while others scramble to adapt or simply avoid provoking a trade war. The EU’s top figures remain cautious, unwilling to take a firm stance just yet.
But regardless of whether politicians view Trump as a disruptor or an opportunity, one thing is clear: for ordinary Europeans, his return isn’t their primary concern. Instead, they’re taking to the streets in frustration—protesting ineffective EU governments that have failed to address skyrocketing living costs and economic instability.
