Europe does not trust America, but depends on it

In a speech delivered at the planet economical Forum last month, Ursula von der Leyen, the head of the European Union's executive body, repeatedly stressed the request for a "independence" block. She gave a speech in the context of threats by US president Donald Trump that she would either invade or force the sale of Greenland, the sovereign territory of Denmark, and punish respective European countries against his plans. This was a landmark minute for the region, which traditionally put careful diplomacy ahead of confrontation with the White House.

Trump Threats could have evaporated. , but Europe is inactive convinced that it should reduce dependence on the United States in trade, energy and technology. However, relaxing these links would be highly hard and would entail immense costs, as CNN analysts say.

"We would like to effort to unravel and break down the ever-increasing social, historical, institutional, economical and financial links on the first fewer centuries", said Neil Shearing, Capital Economics' chief economist.

Nevertheless, Europe cannot afford complacency, as there is simply a hazard that Washington's unstable policy towards allies, in which the winner takes everything, can last Trump's rule, and dependence on the United States can become its weak point. "I think there is now any fundamental mistrust or fear of what might happen (after Trump)," Shearing said.

However, the large function of the United States in the European economy makes it impossible and possibly damaging to the region in its present form. That's why.

Trade

Deepening trade ties with another countries is an crucial way to reduce Europe's dependence on the United States. Already this year, the EU signed trade agreements with India and 4 South American countries, a block called Mercosur, after decades of negotiations.

Carsten Brzeski, the global head of macroeconomic investigation in ING, said that these agreements seem to be a step towards disengaging from Washington, but "Neither Mercosur nor India will be able to take over the function of the United States in European trade within the next decade."

According to the EU Council, the EU and the US have the largest bilateral trade and investment relations in the world. Value of goods and services exchanged between them over EUR 1.68 trillion (2 trillion dollars) in 2024, which accounts for almost 30% of the global exchange.

However, Europe needs the United States much more than Washington, said Brzeski. "Europe has always been export oriented. Europe does not have adequate own resources", while the United States they mostly have a more "isolated, autonomous" economy, he added.

Technology

Europe lacks the large technology companies in large numbers in the US, making the country dependent on American digital service companies. "The net in Europe is indeed an American construct, an American system. And Europe truly has no competitor with it," said Shearing of Capital Economics.

The block's most valuable technology company, the Dutch maker of ASML integrated circuits, has marketplace capitalization about 3 times smaller than Tesla, the least valuable of the alleged large Sevens in the USA – a group of technological giants whose results have late driven the American stock market.

French Prime Minister Sebastien Lecornu announced last week that state officials would abandon Zoom and another American videoconferencing tools and start utilizing French software. This decision aims, inter alia, to reduce "dependency from non-European entities", Lecornu wrote in a letter to ministers, made available by the minister on the X portal.

Brzeski of ING said that Europe would gotta invest immense sums to catch up with US digital service providers, cloud infrastructure and data centres. "In plain terms, Europe must have a kind of European version (the large Seven)," he said.

Energy

Europe is inactive trying to free itself from the long-term dependence on Russian oil and natural gas supply – an addiction that became a strategical weakness following Moscow's massive attack on Ukraine in 2022. The Union increased imports of liquefied natural gas from the United States in order to cover the gap after Russian supplies, thus reducing susceptibility to militarisation its energy resources through Moscow. Before the war Russia was main supplier The EU, covering 40% of its gas needs.

However, Trump's habit of utilizing trade with the U.S. as a weapon by imposing duties to get concessions from allies changed the way hazard assessment was done. The president has already utilized energy as a tool of force in trade negotiations with the EU, obtaining last summertime a commitment from Brussels to buy US energy products worth $750 billion.

According to Wood Mackenzie, US LNG imports accounted for almost a 4th of EU gas request last year, while in 2021 it accounted for 6%. "Of course, it is not a relation akin to what Europe had on Russia... but it is inactive a crucial relationship," said CNN Massimo Di Odoardo, Vice president of Gas and LNG investigation at Wood Mackenzie.

However, according to Di Odoardo , the share of US LNG in the European energy mix is likely to increase over the next fewer years, as national gas production in Norway – now biggest supplier for the block – falling. However, he added that the real usage of American energy as a weapon would require the engagement of private American companies. These companies are bound by long-term supply agreements with European customers and their legal and financial interests require compliance with their conditions.

Unlike pipelined gas, LNG from 1 supplier can easy be replaced with LNG from another. "Diversification of supply is simply a smart policy, alternatively of relying on 1 supplier... (It) is what all sensible government should do," Di Odoardo said.