European companies are looking beyond the United States for trade opportunities as President Donald Trump 's aggressive new tariff regime sparks fresh uncertainty in global trade.

Why It Matters

The shift by European companies away from U.S. markets could have far-reaching consequences for the American economy. As key foreign investors and trading partners reconsider their presence, the U.S. risks losing access to critical goods, capital, and innovation. This could slow job growth, disrupt supply chains, and increase prices for consumers—all while weakening the U.S.'s influence in global markets.

What To Know

On April 2, the White House announced a 10 percent baseline tariff on all imports, with higher rates on countries running trade surpluses —including 34 percent on China, 20 percent on the EU , 25 percent on South Korea, 24 percent on Japan and 32 percent on Taiwan. Mexico and Canada, which were exempt from the new tariffs, still face a previous 25 percent levy .

Trump's announcement immediately sent the markets into turmoil on April 3, with Wall Street recording its worst day since 2020 —when COVID-19 was in full swing. However, U.S. stocks ticked back up on Tuesday.

Amid the uncertainty, European companies are eyeing an opportunity to pivot away from the U.S. market to avoid the effects of the tariffs.

On Thursday, during a meeting at the Elysée Palace with representatives of sectors affected by the tariffs, French President Emmanuel Macron said he wanted EU businesses to stop investing in the U.S.

"It is important that future investments, the investments announced over the last few weeks, should be put on hold for some time until we have clarified things with the United States of America," Macron said.

Mitigating Trump's Tariffs

Earlier this week, the European Commission invited company leaders from the steel and auto industries to an in-person meeting on Thursday to discuss mitigation efforts as the commission looks to diversify its trade away from the U.S.

According to a news release issued by the European Steel Association in February, "The U.S. is the second biggest export market for EU steel producers, representing 16 percent of the total EU steel exports in 2024."

Meanwhile, the Portuguese government is urgently developing a "robust" package of support measures for industries affected by the new U.S. tariffs, including textiles and industrial goods.

Mário Jorge Machado, the president of the Portuguese Textile and Clothing Association (ATP), said the sector had "a lot of exposure to the American market, directly and indirectly, because Portugal exports close to 500 million euros to the United States." Machado added that the sector also sold "many products to Europe" made to order for "European, Italian, French and Scandinavian brands" that then go to the U.S.

Machado has confirmed that the country's Ministry of Economy is holding a series of meetings with business leaders and is poised to present a comprehensive relief plan for the textiles industry. The package may involve export aid, internationalization support and even EU-level involvement for state aid clearance, he said.

Armindo Monteiro, the president of the Confederação Empresarial de Portugal, has also called for long-term market diversification to reduce reliance on the U.S.

At a meeting in Lisbon on Tuesday, Monteiro emphasized that expanding export destinations was now a critical priority. "We need to increase the value of exports and diversify the destination markets," Monteiro said, warning that European economies must act swiftly and strategically to adapt to rising protectionism.

In Norway, fears of being economically sidelined by Trump's tariff regime are accelerating a strategic realignment. Prime Minister Jonas Gahr Støre led a trade delegation to Brussels this week, urging stronger cooperation with the EU amid what his foreign minister called an evolving "situationship."

Although not an EU member, Norway is deeply integrated into the EU's single market and was hit with a 15 percent U.S. tariff—less than the EU's 20 percent but still significant enough to spark concern.

"Europe needs Norway, and Norway needs Europe," Støre said during meetings with EU Commission leaders. He brought with him some 30 top Norwegian business executives, who lobbied for deeper participation in EU trade and defense and economic initiatives—including the EU's SAFE defense procurement program. Norway is also set to join the EU's Import Surveillance Task Force.

If European companies decide to pursue alternative trade routes, there could be major implications for U.S. consumers, with reduced competition in the U.S. market sparking higher prices.

This has prompted concerns from Americans about inflation or a potential recession . Goldman Sachs and J.P. Morgan have raised their recession forecasts in the past month, citing weakening business and consumer confidence.

In a recent Fox News poll of 994 registered voters, 71 percent said they believed the U.S. economy would go into a recession this year, while 26 percent disagreed. The poll had a margin of error of plus or minus 3 percentage points.

Trump has dismissed concerns about his new tariffs, telling reporters, "Sometimes you have to take medicine to fix something." He has also argued that the new tariffs will prevent other countries from continuing to exploit the U.S. economy.

What People Are Saying

The European Commission wrote in a letter sent to business leaders on Tuesday : "The two-hour meeting will be an opportunity to share views on the impact of the tariffs on various industrial sectors as well as the measures the EU could take to mitigate their effect."

French President Emmanuel Macron said on April 3 : "What message would we send by having major European players investing billions of euros in the American economy at a time when [the U.S.] are hitting us?"

What Happens Next

The EU is expected to confirm its retaliatory tariff package by mid-April, with preliminary details already circulating among member states.

Industry groups in the U.S. and Europe are lobbying for carve-outs or exemptions, warning that a prolonged tariff exchange could disrupt key supply chains, especially in heavy machinery and automotive sectors.