It was already obvious in 2024 that the new year, 2025, will be characterised by uncertainties on many levels. Our overview reflects a European perspective.
Global relations
The incoming Trump administration has long been expected to bring considerable changes and possibly turmoil in the form of tariffs, changes in policies, and shifts in focus compared to its predecessor. While a “trade war” with China has been anticipated by many, increased tariffs on Denmark and Canada, as well as pressure on Panama, might be newer developments.
American tariffs on all global imports, should they get implemented, might be detrimental to German exports, the US being Germany’s largest export market. Germany is already facing a governmental crisis, with early elections scheduled for late February 2025.
The global economic outlook also depends on the growth of the Chinese economy, with concerns arising not just because of American tariffs but also EU-China trade disputes.
In the EU, not just Germany, but also France has experienced a second governmental crisis, beyond the snap elections called during the summer of 2024.
The incoming Trump administration most likely also means considerable changes to the American stance on the war in Ukraine and the country’s attitude towards NATO in general. At the same time, the Middle East is also in turmoil, leading to human tragedies.
Planetwide challenges: climate and potential pandemics
2023 and 2024 were the two warmest years ever recorded, and 2025 is expected to reflect this warming trend. Long-term consequences are dire from devastating weather events, floods, and droughts, potential hunger leading to migration, and health issues on the individual level.
And of course, following the covid lockdowns, it is no surprise that there is heightened attention on potential pandemics caused by MPOX, the Marburg virus, bird flu, and the HMPV virus.
Technology
The current big thing, not just in terms of technology but also for the economy, is artificial intelligence. Impacts range from NVIDIA share prices skyrocketing to privacy and copyright-related concerns, sometimes horribly unreliable or outright dangerous outputs, and strikes in certain creative industries – not to mention the question of which positions may become redundant or helped greatly by AI.
AI relies not just on data but also on a tremendous amount of energy, leading to increased interest in the nuclear sector. This additional demand, coupled with the abovementioned uncertainties, might also lead to increased energy and fuel prices.
And of course, there is the possibility that this is a bubble waiting to burst.
Risks in the backyard
The more we zoom in, the more tangible the uncertainties become. Regulations in key markets and countries, purchasing decisions of major partners, changes experienced locally, price increases of your business-specific suppliers, tax changes, and new or updated legal requirements: the closer the change is to you, the bigger it might seem.
An employee going on extended medical leave might require more effort to compensate at the company level than the change of an entire government.
For all such situations, having a long-term partner who can flexibly handle a diverse range of tasks with easy scalability, adjusting to your current needs, can always be handy.
