The big question for all of us at the beginning of 2025 is what kind of relationship will we be able to establish with the new US administration? Many European nations are in desperate need of reviving their economies and are therefore ever more dependent on having close ties to the fast-growing US.
In order to maintain strong linkages across the Atlantic, we will have to pay a price, be that in terms of higher defence spending, buying more from the US, or following the US approach in geopolitical terms. These extra costs will also have to be borne by us and this means that we have to more than double our efforts to revive growth. Furthermore, as many economic recipes of the past will no longer be sufficient in this day and age, we really have to think hard about how we successfully rewire our broader economic frameworks. Doing less and doing differently will often need to be a guiding principle in this respect.
The Labour government under Sir Keir Starmer wants a more dynamic economy, but so far has not managed to revive growth. With German elections expected to result in another coalition government, it is also not clear whether it will trigger the necessary and bold steps for progress. However, what is clear, in any case, is that we would all benefit from closer ties within Europe. Therefore, the planned reset of the UK-EU relationship is more than welcome; the upcoming EU-UK summit, the future British-German Friendship Treaty, the review of the Trade and Cooperation Agreement (TCA), and the closer cooperation on defence and security are all elements which can help us to secure our future prosperity and safety.
In summary, 2025 will definitely be volatile, but as every option trader knows, volatility also creates opportunities and we at the Chamber will help all our businesses to seize these when doing business across the Channel in these uncertain times.
Dr Ulrich Hoppe
Hauptgeschäftsführer
Deutsch-Britische Industrie- und Handelskammer
