Paris (AFP) – French President Emmanuel Macron on Thursday called for a suspension of investment in the United States until Donald Trump’s “brutal and unfounded” new tariffs against Europe and the rest of the world were clarified. His comments followed President Trump imposing sweeping new levies on US trading partners, including a 20 percent tariff on imports from the European Union.
“Future investments, investments announced in the last weeks, should be suspended for a time for as long as the situation with the United States is not clarified,” Macron told a meeting of French companies also attended by French ministers and Prime Minister Francois Bayrou. Macron predicted Americans will be “weaker and poorer” after Trump’s tariff announcement, which he described as “brutal and unfounded” and which would have a “massive impact” on the European economy. He also called on Europe to stand together in terms of their response, warning against any unilateral action.
Macron reaffirmed the French government’s position that a “European response” would come in “two stages.” One would come in mid-April, addressing US tariffs already in place on steel and aluminium. The second would be at the end of April and would be a “more massive response, to the tariffs announced,” after a study of the sectors affected and coordination with EU member states.
– “The world is reorganising” –
Following the meeting, the head of the French employers’ federation Medef, Patrick Martin, stressed the situation was “very serious.” Everyone agreed that “the world is reorganising, trade relations are becoming extremely brutal, threats are accumulating, and the time has come more than ever to accelerate simplification and competitiveness at the European and French level,” he said.
Echoing Macron’s call, business group France Industrie, which represents dozens of major companies, said French manufacturers affected by US tariffs should consider firing back one way or another, including by suspending investment projects in the US. “To negotiate from a position of strength, we have to be ready to use all the levers at our disposal,” said the group’s president, Alexandre Saubot.
French Overseas Minister Manuel Valls called the US decision to impose different tariffs on France’s overseas territories a “deeply political” gesture that reveals an “accumulation of inconsistencies, absurdities and incompetence.” The Paris stock market closed down more than three percent on Thursday after Trump’s tariff blitz — the biggest daily decline in two years. Vincent Vicard, an economist at the Centre for Prospective Studies and International Information, told AFP that Trump’s announcements “blow up” the “basic rules of international trade,” but that the EU was well equipped to respond.
Among other measures, Vicard said EU countries could reduce their imports of goods and services, reduce market access for American companies, or even suspend property rights for certain companies. Direct French investments in the United States were worth $370 billion in 2023, making it the fifth-biggest foreign investor in the country, according to the US Bureau of Economic Analysis (BEA). In comparison, US direct investment in France the same year came to $142 billion, according to France’s central bank. They are heavily weighted towards the manufacturing sector, France’s treasury said.
The American Chamber of Commerce in France told AFP that there are more than 4,200 subsidiaries of French companies operating in the United States. According to the BEA, they employ some 741,000 people.
© 2024 AFP
