The biggest battles headed for Brussels

 

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The biggest battles headed for Brussels

 

What the EU will be squabbling about in VDL’s second term.

 

January 1, 2025 1:30 am CET

By POLITICO

https://www.politico.eu/article/policy-brussels-belgium-deportation-human-rights-european-commission/

 

Get ready for Ursula von der Leyen 2.0.

 

After a first term marked by a pandemic and the outbreak of war on Europe’s doorstep, the European Commission president is gearing up for another spin as the European Union’s top official.

 

While showdowns with geopolitical rivals like Russia, China and Donald Trump’s United States are likely to occupy much of her attention, there will be plenty of fights back home for her as well.

 

Deportations vs. human rights

The final months of von der Leyen’s first term were defined by a major push from EU capitals to crack down on irregular migration into the bloc. The start of her second is likely to be all about migration as well, as leaders look to lock in commitments made during their last gathering in Brussels.

 

First up: Von der Leyen’s Commission is expected to table a proposal for a new directive on “returns,” which is EU jargon for deportations to countries outside the country’s borders. EU capitals expect the Commission to table proposals geared at facilitating deportations in the coming months.

 

Next up, and considerably more tricky is the idea of opening so-called return hubs outside the bloc’s borders, which are really processing centers where asylum-seekers would be housed while their applications are processed. Italy’s experimentation with this idea via a bilateral deal with Albania has already come in for criticism from courts in Rome.

 

The challenge for von der Leyen will be to carry through with the bloc’s agenda on migration without falling into an ethical trap or leading the EU to be accused of inhumane practices.

 

Enlargement vs. the risk of internal division

Another major task in von der Leyen’s inbox is EU enlargement. After Russia’s assault on Ukraine, the EU opened its arms — symbolically — to the membership applications of Ukraine and Moldova, kickstarting a process that’s likely to take years to complete. Von der Leyen will also have to shepherd the applications of Western Balkan states that have been in the EU’s waiting room for much longer.

 

There are clear upsides to enlarging the EU beyond its current cast of 27 members. Expanding the bloc helps to grow its internal market and fight population decline while showing that the EU has a far greater power of attraction as a geopolitical power, than, say, Russia.

 

But it’s also a politically perilous exercise. Amid broad statements of support for enlargement from EU capitals, there are fears that letting in populous countries like Ukraine will flood the EU’s internal market with cheap labor and products, putting other members — particularly neighbors like Poland — at a disadvantage.

 

Such concerns are likely to lead von der Leyen to proceed with caution. But she will also be aware that keeping candidate countries in the EU’s waiting room for too long has its own risks, namely disillusionment and the temptation to pivot toward Moscow.

 

Farmer vs. reformers

The Common Agricultural Policy accounts for more than a third of the EU budget — and 20 million European farmers want to keep it that way.

 

Ursula von der Leyen and her advisers have other ideas: They are desperate to find money to pay for hundreds of billions in investments to restore Europe’s industrial competitiveness — and have their eyes on that vast pot of cash.

 

So far, there is no sign that either the powerful EU farm lobby, which has a vise-like grip on the Commission’s agriculture department, or agriculture ministers in the bloc’s 27 capitals, will give up farming entitlements and instead link payouts to performance targets, such as expanding organic agriculture.

 

The new Agriculture Commissioner Christophe Hansen will find it hard enough to preserve the fragile consensus on farming reforms, which he is supposed to pour into a 100-day “vision” that would seek to placate angry farmers by easing environmental burdens and boosting their incomes. And that will just be the hors d’oeuvre ahead of far tougher bargaining on the CAP ahead of the next multiyear fiscal term starting in 2028.

 

Competition vs. competitiveness

With the EU’s economy stagnating, nothing looms as large for von der Leyen as the need to kickstart the bloc’s competitiveness.

 

Whether it’s American dominance in artificial intelligence, or the recent explosion of Chinese electric vehicle exports, European firms are having their lunch eaten by their overseas rivals, which benefit from their scale and their deeper pockets. Policymakers in Brussels are desperately trying to think up ways to make sure native businesses aren’t left in the dust.

 

One idea from former European Central Bank chief Mario Draghi: Help EU companies scale up. The telecommunication industry is a case in point: The EU has 34 mobile network operators compared with just three in the U.S. The solution? A relaxation of merger rules to allow established players to snap up their smaller rivals.

 

The Spanish socialist Teresa Ribera is heading up the powerful competition portfolio. She will play a role in building up European capabilities in sectors ranging from finance to defense. She will need to answer an existential question lying ahead for competition policy, on whether Europe sticks to an orthodoxy that keeps prices low and companies small, or loosens its approach to let bigger, hopefully more globally competitive players emerge.

 

Free speech vs. online safety

During von der Leyen’s first term, the EU came up with some of the world’s most far-reaching legislation for the digital world, namely the AI Act covering artificial intelligence and the Digital Services Act (DSA) that covers online platforms.

 

The latter set of laws, now in force across the bloc, impose stringent regulations on platforms like Elon Musk’s X or Chinese-owned TikTok over how they monitor their platforms for illegal content. But the world has changed since the DSA came into force, not least because Musk is now the owner of X and has declared war on what he calls “censorship” from regulators.

 

The South African billionaire is also a key ally of U.S. President-elect Donald Trump, and U.S. Vice President-elect JD Vance has gone so far as to link U.S. support for NATO to the EU’s treatment of Musk’s X platform.

 

These warnings will have to be weighed carefully as the Commission moves ahead with an investigation into X, which former digital supremo Thierry Breton accused of flouting the EU’s digital rulebook.

 

Security vs. spending

As the EU contemplates a future in which Washington invests less in NATO and withdraws its support for Ukraine, the bloc is getting ready to fight over money.

 

If the bloc is to take more responsibility for its own security, it will require huge investments in countries not accustomed to spending heavily on defense. Von der Leyen has identified €500 billion in investments needed to boost the bloc’s military-industrial apparatus. The only problem: Where to find it when the continent’s largest economies are struggling and when huge sums are needed to deal with the climate crisis and competitiveness.

 

The other battle is over whether the bloc’s defense funds would be used to buy only made-in-the-EU equipment. Some countries, France chiefly, argue Europe needs to invest in its own production to prime-pump a defense industry that has shrunk considerably since the end of the Cold War.

 

That’s being weighed against the need to be able to obtain weapons systems quickly and efficiently, as well as the risk of irritating Washington. Indeed, U.S. officials make no secret of the fact that they don’t like “Buy European” as an idea. Once Trump is in the White House, the administration could use purchases of U.S. weapons as a way to divide and conquer among EU states, privileging those that continue to buy from America and shunning those that don’t.

 

Green goals vs. tight purse strings

The Clean Industrial Deal promises to be one of the most defining legislative efforts of the next Commission — even if the bill’s actual contents remain vague.

 

The aim, according to the Commission, is to ramp up investments in clean technologies and energy-intensive sectors to keep Europe’s economy humming without losing sight of the bloc’s green objectives. Yet the “how” remains shrouded in mystery given EU countries’ reluctance to put cash on the table.

 

So far, there is only one instrument the EU’s executive has explicitly called for: a European Competitiveness Fund. But its broad scope suggests the clean tech sector will have to compete against other capital-intensive sectors, such as AI and space, to get the money it desperately needs.

 

Making this more complicated, the Clean Industrial Deal will have several masters. Top EU Commissioners Teresa Ribera and Stéphane Séjourné will oversee the master plan, but one of its key components, dubbed the Industrial Decarbonization Accelerator Act (essentially a bill to help clean up the most carbon-belching sectors) will fall under the remit of European Climate Commissioner Wopke Hoekstra, who will also be busy trying to finalize talks to reform the Energy Taxation Directive, which governs tax rates for various energy forms.

 

National interests vs. EU priorities

The European Commission’s proposal this summer for its next seven-year budget will be the official opening salvo to fierce negotiations between national capitals that will stretch until the end of 2027.

 

One of the most politically sensitive topics in Brussels, the €1.2 trillion budget governs spending on anything from support to Ukraine to film subsidies. Hawkish Eastern European and Nordic countries including Poland and Sweden are keen to boost EU spending on defense, while Southern ones such as Italy and Greece would like more cash to stem migrant departures from Africa.

 

One of the big questions is how many hoops countries will need to jump through to access their cash. The Commission would like capitals to implement key economic reforms in exchange for access to their share of EU money. But countries receiving the bulk of the funding — mainly in Eastern Europe — are no fans of this approach.

 

In 2025, EU countries will set their red lines for the negotiations. But if the past is anything to go by, leaders will squabble and only reach a final agreement at the last moment.

 

Clean tech vs. toxic risk

Countries and companies are rushing to develop new technologies in an effort to halt catastrophic climate change — but many such solutions are manufactured with chemicals with unforeseen side effects that pose grave risks of their own. That includes “forever chemicals” or PFAS, the risks of which science is only beginning to understand. Concerns over PFAS have led to an EU effort to phase out the chemicals in a range of sectors the bloc is counting on for the green transition. The EU executive is also due to come up with a revision of the EU’s chemicals safety framework to better protect its citizens from harmful substances.

 

While the European Commission pledged to reduce the bloc’s pollution to levels “no longer considered harmful” to human health and the environment by 2050 — that was back in 2021. Three years, two wars and an energy crisis later — and with a debt crisis potentially brewing — there are other priorities in play.

 

Over the next few years, EU lawmakers and countries will fight over how to make sure a tighter regulatory framework for chemicals doesn’t impede the clean energy transition while still (and, in theory, primarily) keeping the population and environment safe from toxic pollution.

 

Jacopo Barigazzi, Douglas Busvine, Leonie Cater, Federica Di Sario, Carlo Martuscelli, Francesca Micheletti, Barbara Moens, Gregorio Sorgi and Nicholas Vinocur contributed to this report.