The Finder | Our monthly Insights | Issue 21 – September, 2025

This issue is supported by EUMEPS

State of the Union, state of the economy, state of the world: what can the EU achieve in the next year and beyond?

On the 10th of September, in the opening section of the State of the Union speech, Ursula von der Leyen reaffirmed Europe’s unwavering support and collaboration with Ukraine, while calling, once again, for Europe to build its own credible defence readiness alongside NATO. She also addressed the ongoing humanitarian crisis in Gaza, framing these challenges as part of a wider test of Europe’s stance in the global arena.

The remainder of the speech was prevalently focused on economic competitiveness and resilience in all its forms. On this topic, President von der Leyen emphasised that Europe’s autonomy depends on its ability to stay competitive, highlighting the impacts of the ongoing geopolitical instability. She also underlined the importance of maintaining open trade and fair competition, with a clear-but-unspoken reference to China.

In this connection, she pointed at the Draghi report as a reference for future actions, as well as to the need to reform the Single Market. She also highlighted the potential of the Omnibus Package and introduced the Single Market Roadmap to 2028, noting that existing internal barriers are equivalent to tariffs of 45% on goods and 110% on services.

President von der Leyen also emphasised the need for European digital and technological autonomy, remarking the importance of innovation and of investments in gigafactories and clean tech. In fact, as Europe is in need to retain innovations and talent, as well as to improve access to risk capital within the old continent, the 28th regime and the speeding up of the work on the Savings and Investments Union were also presented as pivotal initiatives.

President von der Leyen described the current moment as Europe’s “Independence Moment”, stressing the importance of safeguarding economic competitiveness, democracy and sovereignty in the face of external pressures.

The State of the Union address usually marks the end of the summer recess and outlines the next steps of the EU’s agenda. For the president of the European Commission, it is a chance to command the spotlight by showcasing accomplishments, trail upcoming proposals and set the agenda for the year ahead. While the speech fulfilled this function by outlining priorities and forthcoming initiatives, the atmosphere in the European Parliament was less hopeful than in previous years.

Two fundamental critical aspects of the current EU momentum emerged from von der Leyen’s speech. The first is strictly political, as she acknowledged that “it will be difficult to find majorities” within EU institutions and that “any action will be too much for some, too little for others. But we must all take our own responsibilities: Parliament, Council and Commission”. The second is both economic and diplomatic as she defended the EU-US trade deal, which has sparked controversy over its perceived imbalances. This last question was mirrored in a recent poll which indicated that a majority of EU citizens view the agreement as a “humiliation” for the bloc and a sign of Europe’s weakness at large.

The outlook presented by the President of the European Commission partially stands in contrast to the sobering assessment offered by Mario Draghi at the 16th of September high-level conference on competitiveness, in which the former ECB President warned that, while “Europe’s citizens and companies value the diagnosis, the clear priorities and the action plans, frustration is growing over its slow decision-making”. He also stated that “they are disappointed by how slowly the EU moves. They see us failing to match the speed of change elsewhere. They are ready to act, but fear governments have not grasped the gravity of the moment”, especially compared with the more agile approaches of the US and China.

As some analysts have noted, Europe’s capacity to carry out essential reforms will determine the EU’s economic future, international influence and long-term resilience, extending well beyond the current US administration and regardless of whether the EU-US trade agreement was a necessary appeasement or had to be countered. For this reason, as well, the EU is looking at Latin America, India and Japan as a way to deepen both economic cooperation and security.

Nevertheless, in this context, European officials have been shaken once again by the US President who, in his address at the United Nations General Assembly, criticised the international body and raised concerns about Europe’s immigration policies, energy transition and climate commitments. In fact, in contrast to his 2020 speech, which largely focused on China, Donald Trump’s remarks this year were notably directed at his European allies, who were referenced twice as frequently as Beijing.

A CER Insight warns that the EU’s forthcoming “digital regulatory reset” may provide a key opportunity to simplify and modernise frameworks such as the Digital Services Act (DSA) and the Digital Markets Act (DMA). It stresses that the current patchwork of rules is applied unevenly across member states, leading to high compliance costs and market fragmentation. The author argues that streamlining regulations would help build a more coherent Digital Single Market.

An article by Finabel on the European Commission’s Readiness 2030 White Paper and the ReArm Europe plan, together proposing roughly €800 billion in defence investments, highlights their potential to advance EU defence integration. However, the analysis notes that Article 41(2) of the Treaty on the European Union (TEU) limits the use of the EU budget for military operations, posing a major legal obstacle. The author concludes that, without treaty revisions, stronger political consensus, and innovative budgetary tools, the transformative ambitions of these initiatives will remain constrained.

An ECFR Policy Brief argues that in the face of “Trumponomics”, namely the aggressive trade, investment, and financial measures pursued by President Trump, the EU should avoid impulsive responses. Instead, it should act with unity, pursue long-term reforms and expand the global role of the euro through instruments such as Eurobonds or other pooled safe assets. The author contends that US-driven turbulence could become an opportunity for Europe to strengthen resilience and global influence, rather than leaving it merely reactive.

A Project Syndicate Commentary calls on the EU to defend its sovereignty against US economic pressure by activating the Anti-Coercion Instrument. It warns that renewed tariffs and threats from President Trump undermine Europe’s autonomy, and argues that these are testing whether the EU can assert economic power instead of deferring to Washington.

In the book “Trilateral Imperatives”, a chapter by Clingendael explores the growing importance of EU–Japan–India cooperation on economic security. The analysis stresses that closer collaboration in semiconductors, critical raw materials, quantum technologies, and digital governance is essential to building long-term resilience. The authors conclude that such trilateral cooperation will be crucial for sustaining a rules-based international order and addressing shared strategic challenges.

A CEPS Commentary sheds light on the Paris Agreement, highlighting its threefold aims: limiting warming well below 2°C, boosting climate resilience, and aligning financial flows with low-carbon development. The author argues that the Agreement’s reliance on transparency, peer pressure, and inclusivity has ensured institutional durability, but often at the expense of effectiveness in meeting climate goals.

An Ifri Publication in Alternatives Économiques examines a recent German law that combines a €500 billion special infrastructure fund – spread over twelve years – with a loosening of the debt brake to allow military spending above 1% of GDP. The author frames this as a potential turning point for Germany’s economic model after years of underinvestment and industrial decline. However, she also warns that, without structural reforms, the initial boost in spending will not be sustainable.

ECDPM released a report on Europe–Africa industrial and energy cooperation. The report highlights how complementary assets and interests can be aligned to build green industrial partnerships that are both commercially viable and geopolitically strategic. It also stresses that cooperation is key to meeting Africa’s development and integration goals while supporting Europe’s energy transition. The authors identify the upcoming 7th AU–EU Summit as an opportunity to embed this agenda in policy and foster more resilient, sustainable, and mutually beneficial systems.

An SWP Research Paper, published within the Strategic Refugee and Migration Policy project, analyses Germany’s Migration and Mobility Partnership Agreement (MMPA) with India and the 2024 Skilled Labour Strategy for India. The author finds that, although these initiatives have streamlined visa procedures, improved recognition of qualifications, and deepened migration cooperation, they fall short of creating new legal pathways.

This editorial is authored by Massimiliano Gobbato, Communications Director. Contributions by PubAffairs Communications Team’s Nicole Finucci, Kristina Vilenica and Jacopo Bosica to the drafting of ‘The Finder’ are gratefully acknowledged. 

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