French President Emmanuel Macron has urged European companies to suspend scheduled investments in the United States after U.S. President Donald Trump imposed high tariffs on European Union exports.
Speaking to business leaders and government representatives at the Élysée Palace on Thursday, Macron emphasized Europe should reconsider its position before investing additional financial resources into the American economy. "It is essential that future investments, the announced investments in the last few weeks, must be suspended for a while until we have made things clear with the United States of America," he said.
Macron challenged the rationale of European firms pumping billions into the American economy while at the same time enduring trade barriers. "What signal would we send by having large European players investing billions of euros in the American economy at a moment when [the U.S.] are striking us?" he said, calling on EU countries to unite in economic solidarity.
His comments seemed to be a clear effort to discourage French companies from dealing with Trump's administration, particularly those considering individual deals outside the EU's collective trade agreement. The comments follow French shipping giant CMA CGM's announcement of a €20 billion investment in the U.S. earlier this month, while Bernard Arnault, head of luxury goods empire LVMH, has also shown interest in expanding operations in the U.S., citing good economic policies under Trump.
The trade war intensified further on Wednesday when the Trump administration imposed a 20% tariff on all EU exports to the United States, a move Macron branded as "a brutal and unjustified decision.
He insisted that the event reinforced France's long-standing appeal for a more robust EU trade policy. "We must continue to speed up at the European level with an agenda of protection of trade," Macron claimed, citing the recent EU tariffs imposed on Chinese cars as an illustration of how the bloc can resist economic challenges.
"We are not foolish, we are going to defend ourselves," he said, indicating a strong position against the trade row.
Macron intimated that the EU might strike back not only with counter-tariffs but also by utilizing its anti-coercion tool—an initiative that is usually used against nations like China—and perhaps taking action against U.S. technology giants. "Nothing is excluded, all instruments are on the table," he cautioned.
The news of these tariffs caused shockwaves in European financial markets on Thursday. The Stoxx 600 index fell by 2.7%, with heavily traded companies losing big. German sportswear manufacturer Adidas had its share price fall 11%, and shipping firm Maersk—sometimes used as a barometer for global trade health—dropped 9.5%. The Stoxx Autos index fell 3.9%, a reflection of the effect Trump's new tariffs of 25% on imported cars.
Other sectors felt the brunt as well, with the banking stocks falling by 5.6% and the technology stocks down by 4.5%. The utilities sector was the lone gainer, increasing almost 3%. At the national market level, the UK's FTSE 100 fell 1.6%, while France's CAC 40 and Germany's DAX plummeted more steeply by 3.3% and 3.1%, respectively.
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