It has become a wry joke in Brussels that the most stable country in the EU is Italy, once infamous for its succession of short-lived governments.
France’s Emmanuel Macron and Germany’s Olaf Scholz have been humbled by punishing electoral defeats. Spain’s prime minister, Pedro Sánchez, presides over a minority government in a country riven by division after a controversial amnesty bill. In Poland, Donald Tusk enjoys a much stronger position, but grapples with an unwieldy coalition and an opposition-allied president.
For EU insiders, a collection of weak governments, or just those distracted by domestic woes, is no laughing matter.
Facing war in Ukraine, the possible re-election of Donald Trump and intense economic competition, critics argue current European leaders are not up to the job. “We need now a very ‘on top’ Europe, which we’re not having at the moment,” said Bas Eickhout, who co-leads the Green group in the European parliament, not represented at the European Council table. “I don’t see the leadership. I would not be capable of mentioning one head of state that I would say in a credible way could command that leadership.”
With the leaders of France and Germany weighed down with domestic troubles, the spotlight has turned to Ursula von der Leyen, who is tightening her grip on power at the European Commission.
She is expected to begin a second term as European Commission president on 1 December, nearly six months after the European elections.
Parachuted into the job in a last-minute compromise in 2019, von der Leyen is now a seasoned Brussels operator. “In a second term von der Leyen knows what she’s doing,” said Heather Grabbe, from the Bruegel thinktank. “She knows what power she has, how to make machinery work for her and how to sell things to the capitals … The question is, can she also actually deliver the policies, and most critically, get them implemented? And that’s where the problem of weak governments really counts against her.”
Outlining her agenda to the European parliament last July, von der Leyen promised a “clean industrial deal” aimed at boosting green jobs and industries within her first 100 days, higher and better coordinated European defence spending, and renewed efforts to bring Ukraine and western Balkan countries into the EU.
Without action on the economy the EU risks “a slow and agonising decline”, according to Mario Draghi, the former Italian prime minister, who published a 400-page report outlining the “existential challenge” posed by Europe’s economic weakness vis-a-vis big competitors, such as the US and China. The remedy could cost up to €800bn (£670bn) a year, a level of investment equivalent to 5% of the EU’s economic output, he concluded. That is a conservative estimate, the report says, as it does not count spending on improving skills or adapting to climate breakdown.
So far, von der Leyen has stopped short of endorsing common borrowing to pay for this agenda. The decision rests with the 27 national leaders. But Germany, the EU’s biggest economy, has poured cold water over a second round of common debt, modelled on the groundbreaking Covid recovery plan.
Luuk van Middelaar, a former senior EU official and co-founder of the Brussels Institute for Geopolitics, said he was worried about the risk of disconnect between the Draghi agenda and what national governments can agree to. “European national leaders … can only spend limited political capital on European initiatives. The stars for that have to be aligned for things to work out and currently they are not aligned at all.”
There is “a sense of urgency in Brussels about the state of the world and how Europe is losing out and we need to do something” combined with “weak national governments” faced with an agenda that is important rather than urgent, Van Middelaar said. “And when it’s not urgent, it is very difficult to mobilise the political will of 27 or at least a good majority of national governments to act.”
Adding to the fragmentation, far-right parties have made advances across the continent and are in government, or coalitions or supporting governments in seven EU member states: Croatia, Finland, Hungary, Italy, the Netherlands, Slovakia and Sweden. The far right is now the largest party in Austria, although unlikely to form a government. Europe’s far-right parties remain divided, except when it comes to opposing further European integration.
In the next five-year term, the EU may also face tougher choices, which could further strain shaky coalitions and governments with a far-right presence. “The first von der Leyen term was about the twin green and digital transition, two priorities with strong synergies. Now the second term will be dominated by trade offs,” said Georg Riekeles, a former commission official, now at the European Policy Centre. For instance, he sees a trade-off between the EU’s green deal – a dash for offshore wind energy – and economic security. “For good reasons, we probably don’t want to let China into the supply chain for critical infrastructure or provide our offshore wind turbines … Yet without Chinese climate tech, our green deal is going to be a lot more expensive.”
Grabbe does not see a long-term risk to the green transition but she said: “Our clean tech needs a much better strategy because the Chinese bet on clean tech and they were right to do so. And our car industry being so slow to respond to the policy signals has resulted in the current situation where they’re in serious trouble.”
Throw into the mix the task of agreeing a new EU budget by the end of the five-year period and the picture looks even trickier. This is always a fiendishly difficult political high-wire act, but the next one will generate even harder political fights.
EU officials in charge of the budget will have to square many circles, the most difficult of all being the issue of net payers that do not want a bigger EU budget at a time of increased spending pressures.
Also, EU debt rose to €459bn in 2023, doubling since 2021, largely due to the Covid recovery fund. So far, EU governments have been unable to agree on how to generate funds to pay back the debt, despite the looming repayment timeline starting at the end of 2027.
It could be a messy, politically tempestuous period for the EU. But the force of external pressures will not go away, meaning there is a good chance that many items on the von der Leyen agenda will become national government priorities after five years, Grabbe said.
The “force of external events and pressures” will create its own momentum, whether through climate impacts such as floods, fires and storms, public expectations for high-quality jobs, or the threat of a revanchist Russia, she said, adding: “We will feel a strong pressure for Europe.”
