On January 20, 2025, Donald Trump was inaugurated as the 47th U.S. President, signaling significant shifts in global politics and trade. Trump’s return to the White House comes with plans to withdraw from the Paris Climate Agreement, expand oil and gas production, and enforce protectionist policies – moves that could significantly impact the global economy (1). For Dutch businesses, this renewed focus on "America First" brings both risks and opportunities. To navigate the evolving geopolitical environment, Dutch companies must focus on market diversification, strengthen alternative trade partnerships, and adopt flexible strategies.

U.S.-Netherlands trade relationship

The U.S. has long been one of the Netherlands’ most important trade partners. In 2019, Dutch exports to the U.S. totaled €23 billion, rising to €33.8 billion by 2023 (see Figure 1); making the U.S. the Netherlands’ fifth-largest export market (2; 3). Sectors like technology, chemicals, and agriculture have greatly benefited from stable U.S.-Netherlands trade relations. However, according to Rabobank (4), these sectors are increasingly vulnerable to rising U.S. tariffs. Higher tariffs on Dutch goods could drive up prices, lower export demand, and disrupt established supply chains.

Figure 1: Trade partnership between the U.S. and the Netherlands (2; 3)

The impact of Trump's trade policies

Trump’s trade agenda, which emphasizes U.S. industrial growth and a reduced trade deficit, presents significant challenges for Dutch industries that rely on stable trade with the U.S. (5). His previous implementation of a 10% tariff on Chinese imports raised global concerns, suggesting that similar measures targeting European goods could adversely affect Dutch competitiveness in key sectors such as high-tech, machinery, and agriculture (1; 4). The Netherlands not only exports directly to the U.S. but also serves as a critical link in broader European trade networks. Consequently, any rise in tariffs could disrupt supply chains, lower demand for Dutch exports, and increase operational costs.

Key sectors face particular risks. For example, ASML – the world’s only producer of advanced EUV lithography machines – relies heavily on the U.S. market and its integrated supply chain (1). Stricter U.S. export controls on semiconductor technology could pressure the Netherlands to impose similar restrictions, particularly on the export of advanced semiconductor equipment. These restrictions would directly impact ASML's ability to sell its cutting-edge lithography machines, especially to key markets like China. As a result, ASML could face limitations in selling its most advanced technology, which would disrupt its supply chain and hinder its ability to secure contracts with international partners. Additionally, these regulatory burdens would likely increase administrative and compliance costs, ultimately reducing ASML's competitiveness in the rapidly evolving global market. Similarly, increased import tariffs on European technology products could drive up costs and reduce the competitiveness of Dutch companies in the U.S. market (1).

These risks extend beyond ASML to the entire Dutch machinery industry. This sector alone contributed 1.8% to the Dutch GDP in 2019. Protectionist measures that favor U.S. industries could make Dutch machine technology more expensive and therefore reduce demand (4). To bypass tariffs and take advantage of tax incentives, some firms may consider shifting production to the U.S. – a move that could further impact the Dutch economy (4).

Dutch IT and business service providers could also face new trade restrictions as President Trump’s administration enforces stricter data and cybersecurity regulations. As a key digital hub for Europe, the Netherlands must carefully navigate these changes (6). Tighter U.S. data localization rules could complicate cross-border data flows, increase compliance costs, delay projects, and necessitate localized data centers. Additionally, heightened scrutiny of foreign tech investments might slow Dutch firms’ expansion into the U.S. market (6).

Trump’s defense-led cybersecurity strategy could impose stricter security protocols on Dutch companies collaborating with U.S. partners, impacting data management and cyber defense. While potential rollbacks of regulations like the Cyber Incident Reporting for Critical Infrastructure Act (CIRCIA) may ease some compliance burdens, Dutch firms must uphold high cybersecurity standards due to persistent threats (7).

Thus, Trump’s America-first stance could create barriers for Dutch tech exports and investments in the U.S., yet regulatory relief may also unlock innovation opportunities. To navigate this evolving landscape, Dutch IT firms should maintain robust cybersecurity practices, ensure ongoing compliance, and proactively seek innovation opportunities while balancing associated risks. Close monitoring of U.S. policy changes, including executive orders, will be essential to adjust operations and stay resilient in this shifting environment.

Furthermore, Trump has hinted at weakening the U.S. dollar to boost exports, which could have mixed effects on the Dutch economy. A depreciating dollar would make Dutch exports more expensive for U.S. consumers, reducing competitiveness. However, cheaper U.S. capital might benefit Dutch investors, though this could be offset by increased financial market volatility (8).

Opportunities amidst the challenges

Despite the challenges posed by Trump's trade policies, significant strategic opportunities remain for Dutch businesses. According to Allianz Trade, “The economic impact of Trump's presidency on Benelux countries is complex and multifaceted. Higher trade tariffs and stricter immigration policies are detrimental to export-oriented sectors, but thanks to reforms and reindustrialization, there are certainly opportunities for high-quality, innovative companies” (9). While trade barriers present risks, they also drive businesses to innovate, diversify markets, control costs, and seek new growth avenues (12).

The electronics sector is recovering, moving from the second to the fourth most affected industry due to retaliatory trade measures (see Figure 2). Meanwhile, the service sector is emerging as a potential beneficiary of these policy shifts. Its relative independence from imported goods, coupled with strong domestic demand and new export opportunities, positions it for growth despite broader economic uncertainties (10).

Figure 2: Domestic production in the Netherlands’ manufacturing industry (10)

Escalating U.S.-China tensions could create new opportunities for Benelux companies. As the U.S. seeks to reduce dependence on Chinese goods, Dutch businesses can offer high-quality alternatives, especially in sectors like electronics, chemicals, and machinery. Demand for reliable, non-Chinese suppliers is expected to grow, providing a unique opportunity for companies that can meet these standards (11).

Trump's policies appear poised to offer fiscal advantages to foreign companies with U.S. operations. The potential extension of the Tax Cuts and Jobs Act, along with new tax reductions, could lead to higher profit margins for businesses operating within the U.S. This development presents an opportunity for Dutch multinationals with subsidiaries in the U.S. to strengthen their market position and benefit from a more favorable tax environment (11).

Increased U.S. defense spending might also create opportunities for Dutch firms, particularly in AI and cybersecurity sectors (11). The European Union can leverage this shift to strengthen its strategic autonomy by investing in homegrown technologies, such as green energy and space infrastructure, thereby reducing reliance on U.S. tech (11). Furthermore, political changes in the U.S. may encourage highly skilled professionals to relocate to Europe, fostering a brain gain that could benefit the tech sector (11).

The European cloud project Gaia-X, emphasizing data protection and privacy, positions itself as a sovereign alternative to American cloud services, stimulating innovation and collaboration across the continent (11).

By emphasizing innovation and strategic diversification, Dutch firms can strengthen their global positioning and ensure long-term resilience in a rapidly evolving economic landscape.

Market diversification and innovation

In response to global uncertainties, Dutch firms are encouraged to diversify their trade partnerships beyond the U.S., reinforce collaborations within Europe, and explore emerging global markets (12). Enhanced cooperation within the European Union is essential to mitigate the risks associated with unilateral U.S. policies (12; 13). By fostering a more resilient and integrated approach to global trade, EU partners can provide a collective buffer against external economic pressures (12; 13).

High-quality organizations in technology, agri-tech, and healthcare stand to benefit from increased U.S. defense spending due to growing demand for advanced solutions in areas like artificial intelligence, cybersecurity, and sustainable mobility (12). Adopting flexible production strategies—such as localizing operations in the U.S. or other strategic markets—will help Dutch companies navigate tariff impacts more effectively and capitalize on regional tax incentives (13).

A proactive approach to risk management, combined with a focus on high-quality, niche markets, has allowed Dutch companies to differentiate themselves in competitive sectors such as technology, sustainable mobility, and cybersecurity (12; 13). By emphasizing innovation and strategic diversification, Dutch firms can strengthen their global positioning and ensure long-term resilience.

Strategic EU cooperation and operational flexibility

In the face of these uncertainties, Dutch firms are encouraged to explore alternative trade partners beyond the U.S., reinforcing collaborations within Europe and venturing into emerging global markets.

Enhanced cooperation within the European Union is essential to mitigate the risks associated with unilateral U.S. policies. By working together, EU partners can foster a more resilient and integrated approach to global trade, providing a collective buffer against external economic pressures. In addition, adopting flexible production strategies—such as localizing certain operations in the U.S. or other strategic markets—will help Dutch companies navigate tariff impacts more effectively and take advantage of regional tax incentives (12; 13).

Conclusion: strategic recommendations for dutch companies

To succeed amid Trump’s protectionist policies, Dutch businesses must take proactive steps. Diversifying markets and focusing on high-quality, innovative products will help reduce reliance on the U.S. and align with emerging global demands. Strengthening alliances within the EU will enhance collective bargaining power and bolster supply chain resilience, while adopting flexible production strategies can help mitigate tariff-related challenges. By embracing these strategic initiatives, Dutch companies can not only manage the risks associated with the evolving trade environment but also capitalize on the opportunities presented by a shifting global economic landscape (12; 13). Shall we?

This article is part of The Outside World Formula created by ftrprf

For organizations, it’s pivotal to thoroughly understand what is happening in society. We help companies generate comprehensive insights into societal change and its potential effects on their strategy and operations, both negative and positive. With actionable societal insights, courageous plans, and a can-do mentality, we connect the outside world to your company's strategy. For these outside-world insights, we use a rigorous methodology that includes data processing, quantitative and qualitative analysis, and a thorough review process to ensure the accuracy and consistency of our findings. This article was written based on our monitoring of the theme ‘corporate governance’.

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