French President Emmanuel Macron on Thursday urged a halt to new investments in the United States until the clarity surrounding President Donald Trump’s new tariffs is provided, AFP reported.
The call came after the US administration imposed broad new levies on its trading partners, including a significant 20 per cent tariff on European Union imports.
In a meeting with French business leaders, Macron described Trump’s decision as “brutal and unfounded,” warning that it would weaken the US economy and have severe consequences on Europe.
“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.
He emphasised that future investments should be suspended until the situation with the US tariffs is clarified, and he predicted that the tariffs would lead to a “massive impact” on the European economy.
Macron urged Europe to present a unified response to the tariffs, cautioning against isolated actions.
The French government plans to take a two-step approach: the first phase will address existing US tariffs on steel and aluminium in mid-April, followed by a broader European response at the end of the month after assessing the sectors impacted by the new tariffs.
The head of the French employers’ federation Medef, Patrick Martin, described the situation as “very serious,” with trade relations becoming increasingly hostile.
He called for accelerated efforts to simplify and increase competitiveness within Europe and France.
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.
Business group France Industrie echoed Macron’s sentiment, suggesting that French manufacturers affected by the tariffs might need to consider retaliatory measures, including suspending investment projects in the US.
The Paris stock market saw a sharp decline of over three per cent on Thursday, following Trump’s tariff announcement, marking the largest drop in two years. Economists, such as Vincent Vicard from the Centre for Prospective Studies and International Information, warned that Trump’s actions could undermine the foundational rules of international trade.
However, he emphasised that the European Union is well-positioned to respond to these challenges.
In 2023, French direct investments in the United States amounted to $370bn, making France the fifth-largest foreign investor in the US.
Meanwhile, US investments in France totalled $142billion. French companies, including over 4,200 subsidiaries of French businesses in the US, employ around 741,000 people in the country.(Punch)
