After the war in Ukraine, which crawls, after the soap opera of the customs duties of Donald Trump, here is the vote of confidence that runs the risk of making the Bayrou government fall on September 8, and sinking France again in instability. Companies are experiencing an unprecedented accumulation of shocks.
The lack of visibility in all floors avoids assuming strategic commitments or investing calmly. A climate of uncertainty that feeds sustainable amazement: unable to anticipate, leaders are in sight.
Monetary risk: a difficult concern to administer
In an already unstable world, monetary risk adds additional complexity. The questioning of the independence of the Federal Reserve by Donald Trump is the most striking example. His announcement of the dismissal of a Fed governor cares about the markets, but also illustrates his obsession with weakening the dollar against wind and tide, which worries French exporters.
At the time of Franklin Delano Roosevelt, the Fed had accompanied the Renaissance in a very broad political and economic consensus. At that time, it was about responding to the social and financial disaster of the 1930s. Today, Donald Trump wants to break this consensus. As a result, companies fear a new systemic danger, where the dollar, instead of being a reference point, becomes a source of instability.
THE COMMERCIAL WAR: Customs puzzle
The danger is also commercial. An industrialist summarizes: “The question of new customs tariffs, especially in front of the United States, remains a puzzle without clear text.”
A capital goods manufacturer tells us to export a machine to the United States is an obstacle race. Customs tasks on steel and aluminum can increase up to 50%, but its application is still clear. Impossible to calculate with precision metal participation in a complex machine, composed of engines and multiple subset. Result, uncertainty and frequent bypass, even if European technologies remain sought, the exporter points out.
Conflicts: crisis overlap
Ukraine, Israel-Iran, tensions in Taiwan or between Pakistan and India … Companies feel an overlap of crisis and is no longer a simple succession.
This is, ultimately, the observation that former chief of Cabinet Thierry Burkhard dressed last July when he spoke of a “ratchet effect”: each crisis leaves a lasting impression, which makes the return to normal normality more and more unlikely.
How companies adapt
The issue of value chains remains central. From the Covid, the war in Ukraine and the tensions but American, the leaders reorganize their supply patterns. They diversify their suppliers, relocate certain stages of production and bring the sites of their markets. Objective: Ensure supplies, even if that means paying more.
Despite the risks, opportunities appear. India has become a key market for the French ETIS. The country invests massively, even in defense, and builds a more autonomous model against the United States. Brazil follows a similar trajectory. As an industrialist summarizes, “these areas, which will escape in part of the dollar dependence, offer valuable growth relays.”
Strong expectations with respect to public authorities
At a time when companies demand stability and public support against these excessive shocks that overlap, the expected political chaos in France “arrives badly,” deplores a leader.
The competitiveness clash defended by the former president of the European Central Bank Mario Draghi is in the public debate, but does not materialize, regret that the interviewed industrialists, who also deplore a ECB that is too concentrated in green finances, and compensate for the current geopolitical context.
While the thick fog, a French exporter summarizes the stake of the moment: “adapt constantly, like a sailboat that seeks favorable winds”, by muscating its positions in the bearer areas.
Source: BFM TV
