Trump gloom or green shoots? Europe's year ahead

After Covid-19 and Russia's invasion of Ukraine, is Europe about to get its next existential shock in the shape of Donald Trump? From trade to defense to tech, the combination of mercantilism and MAGA is going to hurt—but hopefully also jolt Europeans out of typical complacency.

- Lionel Laurent

The list of reasons for the European Union to worry is long. The open, trade-oriented 27-member union thrives in predictable, rules-based environments that put commerce first and conflict second. That's butter for the Trumpian knife, with the incoming president preferring to move fast, apply pressure and transact bilaterally. Even before getting his feet under the Oval Office desk, he's leaning on Ukraine's Volodymyr Zelenskiy to cut a deal with Vladimir Putin to end the Russian invasion and threatening allies with a blanket 10 percent tariff to redress deeply held grievances on trade. The combined effect would be a new security dilemma to Europe's east, with EU defense nowhere near ready to pick up the slack of a US pivot to Asia, and a reduction of EU gross domestic product by 0.3 percent by 2026 if tariffs happen, according to Citigroup Inc.

The unity keeping Europe together is also getting weaker. Unlike Mr. Trump's first term, which produced that remarkable image of Germany's Angela Merkel and assorted G-7 partners staring down a defiant American president, the list of leaders able to rally support in the face of a fraying trans-Atlantic relationship is Post-It-sized.