The economic relationship between the United States and the European Union is worth a mind-boggling €8 trillion. This remarkable collaboration equals the combined economies of France and Germany—a big deal, in other words. This number is about one-third of the world’s GDP, highlighting how vital this transatlantic partnership is. As debates over tariffs and trade policy continue to dominate headlines, this relationship becomes increasingly precarious.
Malte Lohan, CEO of the American Chamber of Commerce to the EU, emphasizes the complexity of the US-EU economic ties. He explains that because so much of this relationship is based on sales. These transactions at issue largely involve American subsidiaries doing business in Europe and European subsidiaries doing business in the American market. The movement of goods alone is responsible for €1.7 trillion, frequently considered the bedrock of this unique economic partnership.
The Importance of Goods Flow
The movement of goods between the US and EU is one of the most underappreciated, yet vital aspects of their economic relationship. This collaborative exchange nurtures reciprocal reliance and strengthens the economy, driving innovation and productivity in both public and private domains. As Lohan cautions, unpredictability related to tariffs could stop this momentum.
“You’re planning to make big multi-billion euro investments into your supply chain, into your production facilities, and you don’t know how to calculate the return on those investments because that calculation changes from one day to the next with a tariff being imposed or a countermeasure being imposed and taken off again.” – Malte Lohan
This unpredictability fosters uncertainty among private businesses, freezing out investments that could otherwise go on projects. Lohan stresses that US and EU officials should not avoid a conversation on this issue. Whether or not they are able to reach an agreement in time remains to be seen.
Sectoral Ecosystems at Stake
All across Europe, a variety of sectors, both public and private, invest an extraordinary amount in America. Take Belgium, which has developed a near ideal and diverse ecosystem — not just around its pharmaceutical sector, but southern France, where aerospace is king. Ireland is home to a vibrant pharmaceutical sector, which has been supported by collaboration with American firms.
Lohan reminds us that these often overlooked ecosystems are the source of incredible taxpayer value and innovation. He emphasizes the need to nurture deep relationships, so that when outside forces threaten, those connections will help them thrive.
“Look at the ecosystems which are generated across different parts of Europe with American investment and companies operating there.” – Malte Lohan
With a tariff war looming, Lohan’s concern comes at a critical juncture. She worries that these fights may bleed into the broader US-EU economic relationship, doing damage that may be beyond repair.
The Call for Longer-Term Discussions
US president Donald Trump has a 90 day tariff moratorium. At the same time, Lohan calls to keep talking — a lot — about what US-EU relations should look like going forward. He argues that they can’t stop there that both parties needs to come together to form lasting benefits that go beyond just short-term fixes.
“At least what we can say at this point is that there is space for dialogue. Now whether that dialogue is able, within the short space of time available, to come to a conclusion, I think we still have to see.” – Malte Lohan
The stakes couldn’t be higher for either side. More than just her friendship with Davidson, Lohan adamantly believes that there’s too much at stake in this alliance to allow what-ifs to make it crumble. He continues to note that 100% of those investments are waiting, and that competitors from other states or countries can seize in that delay.
“There is way too much at stake in this relationship to let that be damaged.” – Malte Lohan
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