BGA Managing Partner Martin Wiesmann spoke alongside Penny Naas, Lead, Allied Strategic Competitiveness, German Marshall Fund of the United States, and Nicolas Veron, Senior Fellow, Bruegel – Improving economic policy and Peterson Institute for International Economics, about the “European outlook: Challenges to competitiveness” at this year’s J.P. Morgan Investor Seminar at the World Bank/IMF Spring Meetings 2025.

The panel, moderated by Edward Franklin, Head of Currency and Emerging Markets Sales, J.P. Morgan, was reportedly one of the few with an upbeat tone. Reflecting a radical shift in U.S. sentiment, over half of surveyed investors at the conference expressed intent to increase European exposure—unprecedented, but contingent on Europe getting its act together.

Conference discussions—starting with keynotes by J.P. Morgan CEO Jamie Dimon and Treasury Secretary Scott Bessent—highlighted the speed and depth of global change. Seven key takeaways:

1️⃣ Concern in corporate America as to “what will stop Trump?” is building. So far however, neither boardrooms, nor courtrooms, and also Congress are unlikely to provide effective checks. Also, Republicans seem to have priced in a loss of the House in the midterms.

2️⃣ A mild recession has become the base case, a worse outcome is not excluded. Confidence in a Trump growth scenario—quick trade deals, aggressive tax cuts and deregulation, re-industrialisation – has evaporated.

3️⃣ The realisation is growing that the global consequences of Trump’s policies on trade, monetary system, and geopolitics are profound. The notion of a “new regime” reflects the administration’s determination to reshape the world order. Contrary to Bessent’s claim, this is not “America First” but “America Alone”—isolating China and reviving a 19th-century “spheres of influence” logic. The eventual outcome depends on who—Navarro, Vance, Musk, or Bessent—shapes Trump’s decisions.

4️⃣ This puts massive pressure on Europe, which under such logic would fall into a “Russian sphere” as the Western end of “Eurasia.” Hence preventing Ukraine’s subjugation is existential.

5️⃣ At the same time, by aligning politically, integrating economically and developing its military and technological capabilities, Europe may be able to seize a historic opportunity.

6️⃣ Beyond Europe, countries from Latin America, ASEAN and in particular China will not fail to capitalise on the abrupt breakdown of US cooperation with large parts of the world. Europe must swiftly engage with the “non-aligned” world and find a firm yet constructive stance toward China.

7️⃣ Financial resilience will be vital. The pursuit of a “new regime” by the Trump administration undermines global stability once anchored by the U.S. as global security provider, consumer, and lender of last resort. Damage to the dollar’s reserve currency role and the U.S. Treasury market as key reference has been done and it remains to be seen if and how it may be restored.