In Davos, Europe showed resolve and, for the moment, halted the blow. There have been notable gestures from Christine Lagarde, President of the ECB, and Mark Carney, former Governor of the Bank of England and now Prime Minister of Canada. Considering also the stance of Jerome Powell, Chairman of the Federal Reserve, it seems that the experience of a central banker provides the necessary self-confidence to avoid being intimidated. We have been fortunate that Trump's assault has caught us with a strong and prestigious ECB.
Trump's retreat from Davos should not be interpreted as the consequence of a maneuver to get what he really wanted. He wanted more and must have registered the result as a humiliation (in addition to the Peace Board fiasco). Given such a volatile temperament, we must bear this in mind. The retreat would not have occurred if the only factor of resistance had been the relative firmness of Europe. The decisive factor has been internal in the US. On the one hand, the fear of a repeat of the April 2025 stock market crash. Trump can intimidate governments, but he cannot impose his will on the financial markets. On the other, the vertigo within the Republican Party. It's one thing to pressure allies to pay more for common defense, and quite another to alienate them and jeopardize the alliance. This is an initial indication of internal dissent that is bound to increase. Perhaps we are on the path to the beginning of the end of the extremist phase of Trumpism. The coalition that has brought him to power is too diverse and full of contradictions. It will not be stable. In Davos itself, Musk could be heard explaining very well how, through renewables, Europe can achieve energy self-sufficiency. How does this relate to Trump's policy of making Europe dependent on hydrocarbons supplied from sources controlled by the US?
For Europe, the conflict could lead to the proverbial leap forward that crises often bring about. That's why it's vital that these initial displays of resolve are not fleeting and that we don't back down at the first step backward from the adversary.
One example of resolve has been the agreement with Mercosur. It has been negotiated for 27 years. If it weren't for the Trumpian offensive, we would still be there. It's a good sign that, given the new circumstances, the EU has accelerated its conclusion. And it's a very bad sign that the European Parliament is being frivolous in trying to stop it by requesting an opinion from the CJEU. Let's hope we don't back down and that the position of not questioning the implementation process while we await its ruling prevails.
As with all globally beneficial agreements, there are objections. The most contentious revolve around the impact on the agricultural sector, positive for some subsectors—such as vaccine production—and negative for others. The agreement includes safeguards for its implementation, but naturally, those affected are lobbying for the best possible deal through compensatory measures that may arise in the next EU agricultural policy budget. However, the fact that these negotiations are ongoing should not be a reason to halt the agreement's implementation.
It should be noted that the desirability of Europe's strategic sovereignty does not automatically imply that agricultural products must come from within the EU, although regulations on consumer products (for example, on pesticides) must also apply to imported products.
The Trump example suggests caution when using market access as a weapon. It is legitimate to do so to enforce fair treatment of workers on issues such as child labor, hygiene, or the possibility of collective bargaining. But by no means should it be used to control wages. This is a comparative advantage of countries less developed than ours. For them, trade is a source of economic progress. We must respect it, just as we want more advanced countries to respect our rules. We also compete on wages, yesterday for unskilled labor and today for skilled labor.
It is unnatural that the majority that made the shameful referral to the CJEU possible comes from the extreme right and the non-socialist left. For the former, it is not unexpected: they have no interest in a Europe with its own identity. They prefer it fragmented. In this, they converge with the interests of Trump, who, moreover, wants a Western Hemisphere subservient to the US. He is bothered that, when he attacks Mercosur with tariffs, the EU opens its markets to them. On the other hand, for the left to oppose an agreement that benefits workers in poorer countries is, for me, unexpected. It is inconsistent.
