Europe, in particular, has been caught off guard by Trump and is still struggling to find the ‘how to’ of communicating with him and his administration. However, we must ask ourselves whether it is appropriate, or even useful, to react publicly to everything Trump says. And rather than reacting to his serial provocations, could we not adopt a different stance by trying to put ourselves in his shoes and ask ourselves, at least hypothetically: what if Trump was right?

For many of our fellow citizens, Trump’s election was an emotional shock comparable to the loss of a loved one. Europe seems to be mourning the loss of its long-standing friendship with our ally on the other side of the Atlantic, who now treats us with contempt. Now, after the strong emotions provoked by this re-election--denial, anger, depression, even resignation and sadness--it is time to move on to the next stages: acceptance and reconstruction. This process will be difficult, but it can also be an opportunity for growth and resilience. To succeed in this process, however, we must be brutally honest with ourselves.

Donald Trump is a vocal critic of the European Union (EU), regularly accusing it of economic protectionism, bureaucratic inefficiency and an unfair trading relationship with the United States. Although his rhetoric is often blunt and controversial, it has to be said that some of these criticisms are not entirely unfounded.

One of Trump’s main accusations is that the EU imposes trade barriers on American products while enjoying privileged access to the US market. In response, Trump is threatening the EU with tariffs and a trade war, as he has just done against Canada, Mexico and China. The EU is certainly not one of the worst performers in terms of compliance with international trade rules. That said, when Trump criticises certain practices, in particular non-tariff barriers such as regulations that are complex and costly to implement, the use of sectoral subsidies or complex taxation and parafiscal charges that are sometimes perceived as dissuasive, he may not be entirely wrong. Excessive regulation and red tape are often identified as brakes on innovation and obstacles to economic growth. These measures are aimed in particular at preserving the European vision of stability and fairness, but it is crucial to ensure the right balance between this vision and maintaining an economic framework that encourages entrepreneurship and private investment.

Seen from the outside, some of the EU’s economic policies could be perceived as protectionist and are likely to generate tensions with its international trading partners. What’s more, the implementation of some of these policies is also being contested from within the EU, as they prevent the efficient allocation of resources and may therefore have a negative effect on the EU’s growth potential.

Implicitly, Trump is also criticising the export-led economic model practised by some member states. The EU is an internal market of 450m consumers, 20 member states use the euro and Europe’s potential for ‘endogenous’ growth is well established. However, strengthening the internal market, capital and labour mobility and reducing macroeconomic imbalances within the eurozone no longer seem to be a real priority for the EU. Since the financial and sovereign debt crisis (2008-2014), economic centralisation has certainly been strengthened, but this has not produced any tangible economic benefits, and in some areas there is even a trend towards renationalisation of the internal market (particularly in the area of financial services).

The lesson to be learned? The EU must better balance its trade relations with third countries, increase the resilience of its economic model and reduce its dependence on exports so that its economic policies do not end up alienating it from key allies such as the United States. At the end of January, the European Commission took a first step in the right direction by announcing a simplification of certain regulations--notably in the field of ESG--and new measures to strengthen the competitiveness of the European economy. An encouraging first step, but for the moment, I’m not holding my breath...

Finally, Trump is constantly criticising European countries for under-investing in defence, particularly within Nato. He criticises them for relying excessively on US military support whilst neglecting their own commitments. Although his method of putting pressure on his allies is confrontational, even aggressive, it is hard to disagree with him on the substance. The debate on military spending is reminiscent of the debate on investment in public health during the covid-19 pandemic: with each crisis, policymakers note that the allocation of public spending is inadequate to enable the EU and its member states to respond adequately to the new challenges. Yet, faced with ‘realpolitik’ and the difficulty of saying ‘no,’ old patterns and structures persist, to the detriment of a reallocation of resources more in line with new priorities--be they health, security or innovation and growth.

So Trump’s criticisms, while questionable in form, point to real weaknesses that Europe can no longer continue to ignore. However, if the EU and its member states manage to turn these attacks into an opportunity for introspection and introspection into concrete political action, by tackling trade imbalances, streamlining bureaucracy or restructuring budgets to enable public finances to meet the challenges of the 21st century, the shock provoked by Trump’s election may prove to be quite beneficial. By tackling these challenges head-on, the EU will be able to consolidate its position on the world stage, remove any substance there might be to Trump’s criticism, maintain constructive relations with its partners and rather than wanting to “Make Europe Great Again,” ensure that Europe remains relevant on the international stage.

This column reflects my personal views and should not be construed as representing the position or views of Banque Raiffeisen.

This article was originally published in French.