The trade showdown: Europe and the USA in 2025
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In 2025, the growing trade disparity between the U.S. and Europe takes center stage. The U.S. seeks to narrow the gap, with Trump pushing Europe to buy more gas and oil and produce in the U.S. He also urges an increase in European military spending to balance the books.
A growing divide between the US and Europe
The point of contention between the two contenders has a name: “trade imbalance” which, for the record, at the end of 2024 showed a gap of 230 billion dollars. This value, which includes not only goods but also services, sees the situation for the USA improving and settling at 150 billion dollars. The first result that catches the reader's eye is how Europe’s growth heavily relies on America’s shoulders. Undoubtedly, one of the new president’s primary missions will be to rebalance economic relations between the United States and the rest of the world, with Europe and China leading the way.
Trump’s strategy: pressuring Europe on energy and trade
It is no coincidence that Trump publicly declared that Europe must increase its purchase of gas and oil if it wants to avoid possible new U.S. tariffs on European products. He also urged European companies to produce in America. Without mincing words, he firmly reiterated that the money coming into the U.S. from tariff payments would directly be used to reduce the national debt. It’s worth noting that today the EU already imports half of the LPG it needs from the USA, but this isn’t enough for Trump, who wants to significantly reduce the negative trade gap between the United States and Europe. Moreover, by 2025, spending on these raw materials will already surpass that of 2024, simply because, on January 21, gas on the European market reached 50 euros per MWh, an 83% increase compared to January 2024. The United States sells Europe 15.2% of its oil and 37.8% of its liquefied gas.
The US push for increased production and military spending from Europe
To increase U.S. production capacity, the president has launched his new drilling program, called "drill, baby drill," to significantly increase the supply of these Made-in-USA products within a few years. Additionally, to quickly balance its own trade deficit, Trump is also pushing for an increase in European military spending. To date, more than two-thirds of the arms purchased by Europe to support the war in Ukraine have ended up in U.S. coffers due to the European defense industry’s production incapacity.
Prof.Dott. Fabio Accinelli
A growing divide between the US and Europe
The point of contention between the two contenders has a name: “trade imbalance” which, for the record, at the end of 2024 showed a gap of 230 billion dollars. This value, which includes not only goods but also services, sees the situation for the USA improving and settling at 150 billion dollars. The first result that catches the reader's eye is how Europe’s growth heavily relies on America’s shoulders. Undoubtedly, one of the new president’s primary missions will be to rebalance economic relations between the United States and the rest of the world, with Europe and China leading the way.
Trump’s strategy: pressuring Europe on energy and trade
It is no coincidence that Trump publicly declared that Europe must increase its purchase of gas and oil if it wants to avoid possible new U.S. tariffs on European products. He also urged European companies to produce in America. Without mincing words, he firmly reiterated that the money coming into the U.S. from tariff payments would directly be used to reduce the national debt. It’s worth noting that today the EU already imports half of the LPG it needs from the USA, but this isn’t enough for Trump, who wants to significantly reduce the negative trade gap between the United States and Europe. Moreover, by 2025, spending on these raw materials will already surpass that of 2024, simply because, on January 21, gas on the European market reached 50 euros per MWh, an 83% increase compared to January 2024. The United States sells Europe 15.2% of its oil and 37.8% of its liquefied gas.
The US push for increased production and military spending from Europe
To increase U.S. production capacity, the president has launched his new drilling program, called "drill, baby drill," to significantly increase the supply of these Made-in-USA products within a few years. Additionally, to quickly balance its own trade deficit, Trump is also pushing for an increase in European military spending. To date, more than two-thirds of the arms purchased by Europe to support the war in Ukraine have ended up in U.S. coffers due to the European defense industry’s production incapacity.
Prof.Dott. Fabio Accinelli