Friday

20th Apr 2018

Magazine

The EU and US in the age of Trump

America's face changed when Donald Trump replaced Barack Obama. But one year on, the foundations of the transatlantic relationship are still intact.

At the same time, the EU itself has also changed due to Brexit. The wider European neighbourhood is almost unrecognisable, with Russia at war in Ukraine and with the Syrian conflict.

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  • Trump's move to cancel TTIP has increased uncertainty on US-EU trade relations. (Photo: Reuters)

The switch in the US from Nobel laureate and first black president, Obama, to Trump, a billionaire populist who tweets fake news and insults, and defends white supremacists, could hardly have been more extreme.

Trump began his tenure by praising Brexit in what looked like the dawn of a new age of populism in the west.

He also praised Russian leader Vladimir Putin and threatened to tear up Nato's mutual defence pact if EU nations did not spend more money, amid a swirl of allegations that he had colluded with the Kremlin to win the US election.

Obama had advanced an EU-US free trade treaty designed to deepen transatlantic relations, but Trump, under his 'America First' policy, cancelled the so-called TTIP (Transatlantic Trade and Investment Partnership) trade pact.

Obama had also signed up to the Paris accord on climate change, but Trump pulled out of the international agreement.

The new US leader also threatened to tear up an EU-sponsored deal on Iran's nuclear proliferation, opening up multiple fronts of disagreement.

One year on, Trump continues to astonish EU diplomats. In November, he called the North Korean leader "short and fat" in a tweet amid escalating risk of a nuclear confrontation.

Blunting the Trump effect

On the other side of the transatlantic equation, the EU also changed in the past 12 months.

Brexit talks threaten to get ugly, in what could cause a trade rift if the UK crashes out in 2019 with no exit deal.

The far-right AfD party has entered parliament in Germany with nearly 100 MPs, and populist parties are kicking at the EU in Hungary, Italy, and Poland.

But the populist wave is in abeyance. The far-right Marine Le Pen lost elections to EU darling Emmanuel Macron in France, the anti-EU Geert Wilders came second in the Netherlands, and chancellor Angela Merkel won a fourth term in Germany.

France and Germany are also spearheading a push for deeper integration - on the euro, on defence, and on migration - amid opinion polls that signal a post-Brexit revival of pro-EU feelings.

Trump's Putin controversies have done little to alter the main pillar of US-EU ties - Nato's mutual defence.

US military chiefs have repeatedly pledged their commitment to Nato. The US is also leading a Nato battalion in Poland to deter Russian aggression.

The US extended the life of joint EU economic sanctions on Russia over Putin's war in Ukraine and stands ready to ship defensive weapons to Kiev.

Congress has also shown the limits of Trump's foreign policy powers. It passed a new package of even harsher Russia sanctions in the teeth of the Trump white house, and looks far from certain in letting Trump have his way on Iran.

Meanwhile, Trump's decision on climate change has had less impact than at first feared.

192 out of 193 UN members, including all 28 EU states, affirmed their backing of the Paris accord at a conference in Bonn, Germany, in November - making the US the odd man out. Since Trump's announcement to pull out of Paris, Nicaragua and Syria - the only two laggards - signed up to the historic climate treaty.

EU diplomats also said that individual US states and companies pledged to honour the accord, blunting the Trump effect.

Trump on trade

With no prospect of reviving TTIP talks, the EU and US are still in uncertain waters on trade.

But any significant impact on EU-US trade remains to be felt. The trillion-sized transatlantic trade relationship in goods and services was down €93 billion in the year so far as of November, but this was part of a wider trend and better than pre-Trump trade, which shrank by €103 billion in 2016.

The impact on global free trade also remains to be felt - the EU has concluded a free-trade treaty with Canada, ratified one with Ukraine, and advanced on deals with India and Japan.

If Trump leaves office in 2020, or earlier if a US investigation into the alleged Kremlin collusion unseats him, TTIP could come out of the freezer.

The age of Trump is a period of heightened volatility in EU-US relations and in the stable world order they underpin. The damage done to transatlantic ties is not insignificant, but limited and could be repaired.

EU view

Speaking to EUobserver on condition of anonymity, one senior EU diplomat said Trump's antics were no laughing matter.

"The biggest danger for Europe is a paralysis with regard to the question of Russia … the US is emerging as the weakest point of the Western alliance", he said.

He said the harm done to EU-US diplomacy was real.

"Brussels, Paris, Berlin, Rome, and Madrid are unwilling to work with Washington on a number of crucial international issues," he said, mentioning Nato spending, Iran, Syria, climate change, and energy security.

The EU diplomat indicated that the harm could be repaired, however.

He said the EU needed to "be patient" and to show that "trust was intact" in the deeper US state - the "State Department, Pentagon, and intelligence agencies".

But Trump's harm to America's international reputation, which underpins the legitimacy of its superpower status, is another matter and could be harder to heal.

This story was originally published in EUobserver's 2017 Europe in Review Magazine.

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