The New Transatlantic Economic Struggle
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April 04, 2025
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This article was published in El Confidencial on April 3rd 2025
Tariff wars can trigger issues just as serious as rising product prices. They can foster a sense of confrontation and rejection among European consumers—and perhaps even among North Americans—whose consequences are unpredictable but undoubtedly significant. This is due to the strong commercial integration between both economies, meaning any harm to one will inevitably impact the other.
The European Union and the United States maintain the most extensive bilateral trade and investment relationship in the world. Together, they account for nearly 30% of global trade in goods and services and 43% of the world's GDP. In 2023, transatlantic trade in goods and services reached €1.6 trillion, according to European Commission data.
Breaking down their roles, the United States invests in the EU four times more than in the entire Asia-Pacific region. Likewise, EU foreign direct investment in the U.S. is roughly ten times the sum of its investments in India and China. According to Brussels, U.S. exports to the EU generate millions of jobs in America, just as European companies selling products in the U.S. do the same for employment in Europe.
With such deep interconnection, stirring up anti-American or anti-European sentiment in retail consumption is a risky game. It could spark a chain reaction that is difficult to contain and deeply damaging to both sides.
So far, no European government has issued political statements calling for boycotts or hostility toward U.S. products, despite President Donald Trump's harsh rhetoric against Europe. The European Commission has also shown no concrete strategy to counter U.S. tariffs, even though they were a key campaign promise and their implementation should come as no surprise. Once again, Brussels is taking a reactive stance to Washington.
In Canada, since 2018, an association called Buy Canadian has encouraged local product purchases. While it explicitly distances itself from an anti-American stance, some of its members, in light of recent tensions, have expressed views such as: "Just don’t buy American. Hit them where it hurts." Recently, a similar initiative, Buy European Made, has emerged, promoting European alternatives to popular U.S. tech, cultural, and industrial products. In London, Buy Britain follows a similar model, with the slogan: "If you're a UK-based manufacturer or creator, we’d love to showcase your brand and British-made products to the world." These movements claim to be about promoting local goods rather than boycotting others, but the line between the two is thin and easily crossed.
Beyond these platforms, it wouldn't be surprising to see universities, municipalities, and private organizations advocating for local products. The intention aligns with principles of sustainable and circular economies, which have been promoted in Europe for years. Following the pandemic, the EU pushed for reindustrialization, encouraging the creation of companies focused on sustainability, climate change mitigation, energy independence, digitalization, and strengthening Europe’s position in the global economic arena.
These principles are not inherently anti-American; they apply equally to products from the U.S., China, or Canada. Perhaps for this reason, some U.S. companies—particularly in the food industry—have started engaging in corporate activism, advertising their reliance on local suppliers and emphasizing their integration into European economies.
At the same time, the EU is developing legislation to incentivize local production through public-private procurement mechanisms. This legal framework, still in progress, aims to prioritize the purchase of European-made goods and services, bolstering national industries while enhancing economic resilience, sustainability, and strategic autonomy—especially in key sectors like technology, energy, and healthcare.
Europe is already familiar with tensions over tariffs, as this issue follows years of disputes with U.S. and Chinese tech giants. These conflicts predate Trump’s presidency, proving they are not simply anti-Trump reactions but longstanding concerns.
Sustainability is another factor fueling these tensions. U.S. companies must recognize that ESG policies (environmental, social, and governance) remain crucial in Europe, despite their declining importance in the U.S. Civil society groups and consumer movements should be careful not to conflate rejection of non-compliant firms with blanket opposition to American-made products. Rational decision-making is needed—but inflammatory rhetoric from Washington leaders does not help.
It is not far-fetched to predict a consumer backlash against U.S. products in Europe. This wouldn’t resemble Spain’s 15-M movement but could be even more widespread and emotionally driven, responding to a trade war that Europe did not start—one with profound economic and sustainability implications.
Hostile U.S. rhetoric toward Europe is already harming American businesses. Their best strategy might be to successfully appeal to European consumers by understanding their values, priorities, and concerns—and acting accordingly. The battle for the European consumer has begun, and it won’t just play out in political arenas—it will be fought in the hearts and minds of those deciding what to buy.
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Published
April 04, 2025
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Senior Managing Director, Head of Spain Public Affairs