Many describe our geopolitical moment as one of instability, but that word feels too weak for what we are living through. Some, like Mark Carney, argue that we are facing a rupture: a break with assumptions that anchored the global economic and political order for decades. Others, like Christine Lagarde, see a profound transition, a shift toward a new configuration of power, technology and societal expectations. Whichever perception we adopt, the implication is clear: leaders can no longer rely on yesterday’s mental models, institutional routines or governance templates. Johanna Mair is the Director of the Florence School of Transnational Governance at the European University Institute in Florence, where she leads education, training and research on governance beyond the nation state. Security, for example, is no longer a discrete policy field. It now reaches deeply into energy systems, artificial intelligence, cyber governance, financial stability and democratic resilience, all under conditions of strategic competition and mistrust. At the same time, competitiveness cannot be reduced to productivity metrics or short-term growth rates. It is about a society’s capacity to innovate, regulate effectively and mobilize investment toward long-term objectives — from the green and digital transitions to social cohesion. This dense web of interdependence is where transnational governance is practiced every day. The European Union illustrates this reality vividly. No single member state can build the capacity to manage these transformations on its own. EU institutions and other regional bodies shape regulatory frameworks and collective responses; corporations influence infrastructure and supply chains; financial institutions direct capital flows; and civic actors respond to social fragmentation and governance gaps. Effective leadership has become a systemic endeavour: it requires coordination across these levels, while sustaining public legitimacy and defending liberal democratic principles. > Our mission is to teach and train current and future leaders, equipping them > with the knowledge, skills and networks to tackle global challenges in ways > that are both innovative and grounded in democratic values. The Florence School of Transnational Governance (STG) at the European University Institute was created precisely to respond to this need. Located in Florence and embedded in a European institution founded by EU member states, the STG is a hub where policymakers, business leaders, civil society, media and academia meet to work on governance beyond national borders. Our mission is to teach and train current and future leaders, equipping them with the knowledge, skills and networks to tackle global challenges in ways that are both innovative and grounded in democratic values. What makes this mission distinctive is not only the topics we address, but also how and with whom we address them. We see leadership development as a practice embedded in real institutions, not a purely classroom-based exercise. People do not come to Florence to observe transnational governance from a distance; they come to practice it, test hypotheses and co-create solutions with peers who work on the frontlines of policy and politics. This philosophy underpins our portfolio of programs, from degree offerings to executive education. With early career professionals, we focus on helping them understand and shape governance beyond the state, whether in international organizations, national administrations, the private sector or civil society. We encourage them to see institutions not as static structures, but as arrangements that can and must be strengthened and reformed to support a liberal, rules-based order under stress. At the same time, we devote significant attention to practitioners already in positions of responsibility. Our Global Executive Master (GEM) is designed for experienced professionals who cannot pause their careers, but recognize that the governance landscape in which they operate has changed fundamentally. Developed by the STG, the GEM convenes participants from EU institutions, national administrations, international organizations, business and civil society — professionals from a wide range of nationalities and institutional backgrounds, reflecting the coalitions required to address complex problems. The program is structured to fit the reality of leadership today. Delivered part time over two years, it combines online learning with residential periods in Florence and executive study visits in key policy centres. This blended format allows participants to remain in full-time roles while advancing their qualifications and networks, and it ensures that learning is continuously tested against institutional realities rather than remaining an abstract exercise. Participants specialize in tracks such as geopolitics and security, tech and governance, economy and finance, or energy and climate. Alongside this subject depth, they build capabilities more commonly associated with top executive programs than traditional public policy degrees: change management, negotiations, strategic communication, foresight and leadership under uncertainty. These skills are essential for bridging policy design and implementation — a gap that is increasingly visible as governments struggle to deliver on ambitious agendas. Executive study visits are a core element of this practice-oriented approach. In a recent Brussels visit, GEM participants engaged with high-level speakers from the European Commission, the European External Action Service, the Council, the European Parliament, NATO, Business Europe, Fleishman Hillard and POLITICO itself. Over several days, they discussed foreign and security policy, industrial strategy, strategic foresight and the governance of emerging technologies. These encounters do more than illustrate theory; they give participants a chance to stress-test their assumptions, understand the constraints facing decision-makers and build relationships across institutional boundaries. via EUI Throughout the program, each participant develops a capstone project that addresses a strategic challenge connected to a policy organization, often their own employer. This ensures that executive education translates into institutional impact: projects range from new regulatory approaches and partnership models to internal reforms aimed at making organizations more agile and resilient. At the same time, they help weave a durable transnational network of practitioners who can work together beyond the programme. Across our activities at the STG, a common thread runs through our work: a commitment to defending and renewing the liberal order through concrete practice. Addressing the rupture or transition we are living through requires more than technical fixes. It demands leaders who can think systemically, act across borders and design governance solutions that are both unconventional and democratically legitimate. > Across our activities at the STG, a common thread runs through our work: a > commitment to defending and renewing the liberal order through concrete > practice. In a period defined by systemic risk and strategic competition, leadership development cannot remain sectoral or reactive. It must be interdisciplinary, practice-oriented and anchored in real policy environments. At the Florence School of Transnational Governance, we aim to create precisely this kind of learning community — one where students, fellows and executives work side by side to reimagine how institutions can respond to global challenges. For policymakers and professionals who recognize themselves in this moment of rupture, our programs — including the GEM — offer a space to step back, learn with peers and return to their institutions better equipped to lead change. The task is urgent, but it is also an opportunity: by investing in transnational governance education today, we can help lay the foundations for a more resilient and inclusive order tomorrow.

Listen on * Spotify * Apple Music * Amazon Music “Made in Europe” is finally here. After four delays and fierce internal battles, the European Commission unveils its Industrial Accelerator Act — a plan aimed at challenging China’s dominance in clean tech and tilting public procurement toward EU-made products. Ian Wishart and senior finance reporter Kathryn Carlson break down what the push really means: Who stands to benefit, who fears creeping protectionism, and whether Brussels is turning inward at a fragile moment for global trade. Meanwhile, the Iran war is already pushing up gas prices and shipping insurance costs — and splitting Europe’s far right. Plus: The EU manages to mess up its translator exam … again. We’d love to hear from you. Tell us what you think about the podcast, suggest a topic we should cover, or let us know where — and when — you like to listen. You can reach us at our WhatsApp: +32 491 05 06 29. **A message for Amazon: Today's episode is presented by Amazon. Sixty percent of sales on Amazon come from independent sellers. Across Europe, over two hundred and eighty thousand Small and Medium Enterprises partner with Amazon to grow their business. Learn more at Aboutamazon.eu. **

OTTAWA — It’s the world’s most awkward breakup. More than a year after U.S. President Donald Trump casually joked about absorbing Canada and repeatedly threatened debilitating tariffs on its goods, many Canadians are convinced their former pals to the south have lost the plot. New results from The POLITICO Poll suggest a lasting chill has settled over the world’s former bosom buddies. Americans are rosy as ever about their northern neighbors, but Canadians don’t share the love. Their message to America: It’s not us, it’s you. Canadians don’t see Trump’s America as merely an annoyance, the survey found. They consider the superpower next door the world’s greatest threat to peacetime. The POLITICO Poll — in partnership with U.K. polling firm Public First — finds Canadians increasingly view the United States as a source of global volatility instead of as a stabilizing ally. In survey question after survey question, Canadians say the U.S. no longer reflects their values, is more likely to provoke conflict than to prevent it and, as a result, is pushing Canada to consider closer ties with other global powers — including overtures to China that would have seemed unthinkable only a couple of years ago. Here’s the Canada-U.S. schism explained in five charts. Canadian Prime Minister Mark Carney rose to power on a pledge to defend Canada from Trump. When the realities of a prolonged trade war set in, he promised to reduce Canada’s reliance on its nearest neighbor. Roughly three-quarters of Canadian exports find their way to U.S. customers. Carney has traveled the world in search of new partnerships with the European Union, China and Qatar. A new defense industrial strategy sets targets aimed at building up domestic production and buying overseas kit for the military only when necessary. Carney put a finer point on his worldview with a headline-making rallying cry in Davos: In a world of great-power rivalry and fewer rules, middle powers need to band together. The POLITICO Poll shows Carney’s approach is popular at home. Canadians were the most likely — among respondents in Canada, Germany, France and the U.K. — to say the U.S. is not a reliable ally (58 percent). A slight 42 percent plurality of respondents from Canada go even further, saying the U.S. is no longer an ally of Canada. Only about one in three Canadians, 37 percent, said “The US is still an ally of Canada.” Other results that reveal the extent of Canada’s mistrust: * 57 percent of Canadians in the poll said the U.S. cannot be depended on in a crisis. * 67 percent say the U.S. “challenges” — as opposed to supports — its allies around the world. * 69 percent agree the U.S. tends to create problems for other countries rather than solve them. Europeans see the greatest threat to world peace in their own backyard. Slight majorities in the three European countries in the poll chose Russia, which upended the global order nearly four years ago with its full-scale invasion of Ukraine, as the largest threat: Germany (56 percent), France (55 percent) and the UK (53 percent). Canadians are likewise worried about what’s next door. Almost half of Canadians point a finger at the U.S. — a 19-point lead over Russia, which took the next largest share (29 percent). A large plurality of Canadians (43 percent) see the U.S. as “mostly a threat” to global stability. Another 34 percent say Americans are “sometimes a force for stability, sometimes a threat.” Conservative voters agree that the U.S. is the top threat to peace — but only 35 percent of them. Another 30 percent picked Russia, followed by 22 percent who said China. More than two out of three Canadians believe Trump is actively seeking conflict with other countries. Liberal voters who powered Carney’s stunning victory last year — a rare fourth-consecutive win for the party — overwhelmingly see things that way. Progressive New Democrats are even likelier than the centrist governing party to hold that view. But even Conservative voters, who broadly support close and enduring ties with Americans, have mixed feelings. A 57 percent majority say the U.S. president is looking around the world for a fight. And that foreign intervention worries them, too: 47 percent of Canadians say U.S. involvement overseas makes the world less safe. In the middle of the Covid pandemic, Canadians viewed Beijing with deep suspicion. Chinese authorities had for more years imprisoned two Canadians, Michael Kovrig and Michael Spavor, on espionage charges. Ottawa and Western allies widely viewed the so-called Two Michaels’ prolonged detention as retaliation for Canada’s arrest of Huawei exec Meng Wanzhou as part of an extradition request from Washington. In 2021, several months before the Two Michaels were released, a Research Co. survey revealed a low point in Canadians’ take on China: only 19 percent held a positive view. The U.S. president’s torching of the relationship with Canada has flipped public opinion. Forced to pick, a majority of Canadians (57 percent) now say they’d rather depend on China than Trump’s America. Asked whether Canada should deliberately move closer to China, 39 percent agreed — with a majority of those respondents (60 percent) directly naming Trump as the reason to build bridges across the Pacific. Any prolonged Canada-U.S. tension feels deeply personal to many border-town residents. The rivers and lakes and straight-line boundaries that divide the two countries were for decades just technicalities. Ask a Canadian who grew up on the Ontario side of Niagara Falls, and they’ll talk about going “over the river” — not across a border — to visit friends and family, go to work or have a night out. But Canadian visits to the U.S. have dropped significantly since Trump’s inauguration. Tourists are taking their money elsewhere. Snowbirds who flock annually to Florida and Arizona have found other sunny options. A declining state of affairs has frayed countless deeply woven ties. Still, respondents expressed some optimism about the future. Forty-one percent of Canadians say Trump represents a lasting change. But nearly half (49 percent) said the relationship between the United States and Canada will recover in a post-Trump era. A similar proportion of Canadians share that optimism across party lines: Liberal (51 percent), Conservative (50) and NDP (46). But then there’s the solid core of skeptics — 29 percent of the country is convinced there is no going back. Carney won on an “elbows up” rallying cry that urged Canadians to stand up for themselves. Now they’re reckoning with the everyday impact of a lasting cross-border rupture. The country seems to have settled on a new maxim for now: America if necessary, but not necessarily America.

LONDON — Reform UK would scrap Britain’s planned carbon border tax if it wins power, the party’s business and trade chief Richard Tice has said.  Speaking to POLITICO on Tuesday, Tice vowed to ditch the U.K.’s new carbon border adjustment mechanism (CBAM) as part of a broader rollback of climate levies.  Reform would look “to promote oil and gas, but also scrap all these levies and green taxes, CBAM, the whole lot of it all goes,” he said.  Britain is currently drawing up its own carbon tax regime — which would charge importers of carbon-intensive goods a fee based on their carbon emissions. Ministers plan to link the regime to the EU’s equivalent scheme as part of their wider effort to reset post-Brexit trade ties — in a move designed to shield British exporters from being hit by Brussels’ carbon border tax. Business groups warn that scrapping the system could backfire.  “It is an illusion that cutting CBAM or cutting carbon prices would have a long-term benefit for U.K. competitiveness,” said Adam Berman, director of policy and advocacy at Energy UK.  The short-term consequence of scrapping the policy, he argued, would be to leave British exporters facing “a substantial new tax at the border on their exports with Europe.” In the longer term, Britain would be increasingly locked out of key markets, not just Europe, Berman said.  “Major trading blocs around the world are doing the same thing,” said Berman. “In that context, we are going to see a proliferation of CBAMs around the world. China doesn’t have one today, but you can be certain they will implement one at some point in the future.  “India doesn’t have one today, but we can be absolutely certain that it will come as soon as they have a robust domestic carbon price. They will want to protect their industrial base from unfair competition.”  TICE WARNS EU ‘CHANGE IS COMING’ Tice made clear the carbon border tax would not be the only casualty.  Reform UK has already pledged to shred Keir Starmer’s EU reset if they get into power. | Pool photo by Andy Rain via EPA “There are going to be aspects that this government is negotiating with the EU that we will unwind immediately,” he said. “There will be some significant renegotiations in a number of different areas.” Reform has already pledged to shred Keir Starmer’s EU reset if they get into power — with the EU reportedly weighing a “Farage-clause” to protect the deal from regressing.  Other than CBAM, Tice pointed to several aspects of the reset, including the agri-food deal, Erasmus participation, and the SAFE loan program for defense procurement.  “They need to understand that change is coming,” he warned. “We shouldn’t be paying vast amounts of money for SAFE, we shouldn’t be rejoining Erasmus at vast cost for no benefit to ourselves whatsoever,” he added. “We shouldn’t be dynamically aligning with any of their rules. Remember, this is an EU where, even though we’re flatlining, actually, Germany and France’s economies are in even worse shape than our own. Why would you handcuff yourself to a failing economic model?” ‘PRO-BRITISH’ PROCUREMENT PUSH Alongside the rollback of green levies, Tice signaled a more interventionist industrial strategy at home.  More details on a pro-British procurement strategy will be unveiled next week, he said, centered on a “strong presumption in favor of buying steel manufactured in the U.K.”  The proposed steel mandate would apply to infrastructure including rail, defense, housing construction and public buildings. Tice also said the new mega Chinese embassy should be built using British steel. Tice acknowledged there are limits to how far such a policy could go.  A blanket mandate to use British steel risks breaching World Trade Organization non-discrimination rules — a legal constraint that would need to be navigated.

LONDON — Canadian Prime Minister Mark Carney has offered to “broker a bridge” between the European Union and a fast-growing Indo-Pacific trade bloc this year to form a new anti-Trump trade pact. Carney was responding to questions on Tuesday about POLITICO’s reporting that Ottawa is spearheading conversations between the EU and nations in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). “We can help broker a bridge between the two,” Carney said during a press conference as he unveiled Canada’s defense industrial strategy in Montreal. “It’s the opportunity to have a rules-based trading bloc of one and a half billion people with complementary economies, and also provides a basis potentially for further expansion out of that,” the prime minister said. The CPTPP trade bloc includes Canada, the U.K., Japan, Australia, Mexico, New Zealand, Vietnam, Singapore, Malaysia and other Pacific nations. The plans would bring nearly 40 nations on opposite sides of the globe closer together to reach a deal on so-called rules of origin. These rules determine the economic nationality of a product. A deal would allow manufacturers throughout the two blocs to trade goods and their parts more seamlessly in a low-tariff process known as cumulation. Carney said Canada is “in a unique position” to push talks forward with the 27 nations of the EU as it’s both a member of CPTPP and has the CETA trade deal with Brussels. “We’re not alone in this idea. It’s one of the first conversations I had with the prime ministers of Australia and New Zealand — like-minded countries who see the merits in developing this,” Carney said, citing a “series of conversations” with European Commission President Ursula von der Leyen and European Council President António Costa and several CPTPP leaders about it. Carney spoke with Keir Starmer about the talks on Monday, according to a read-out of their call. “Stronger ties between the EU and CPTPP members will strengthen supply chains, unlock new opportunities for Canadian businesses, and reinforce a rules-based trading system,” wrote Canada’s International Trade Minister Maninder Sidhu on Monday. “Canada is proud to be at the centre of this momentum.”

LONDON — Reform UK is not a one-man band anymore. At least, that’s what Nigel Farage wants you to think. The leader of Britain’s populist right-wing party named four politicians to lead on key policy areas on Tuesday, after months of deliberate ambiguity about who does what in his top team. At a made-for-TV event in Westminster’s Church House — where Tony Blair addressed Labour MPs after his 1997 landslide — Farage promised an economic “super department” modelled on German rebuilding after World War 2, led by his deputy Richard Tice. Recent Conservative Party defectors Robert Jenrick and Suella Braverman will lead on the Treasury brief and education, skills and equalities respectively, while millionaire donor Zia Yusuf, Reform’s head of policy, will focus on home affairs and migration. Farage gave all four “shadow” government job titles, despite British convention reserving these only for the party of parliamentary opposition (the Conservatives). But his upstart party’s poll lead — and instability in the center-left Labour government — mean pressure has been growing for him to color in the lines of his plan for Britain. The message so far embodies the tension at the heart of Reform’s pitch to voters — be radical enough to inspire right-leaning voters but safe enough to keep their vote; give enough detail to look serious but not tie itself up in knots; and be Farage-focused enough to benefit from his stardust without turning into a one-man show. Here, POLITICO looks at what today’s line-up shows about Farage’s plan for government. 1) REFORM IS STILL MORE A CAMPAIGNING FORCE THAN A GOVERNMENT-IN-WAITING Farage insists Britain could get a snap general election in 2027, but his choice of priorities today — zoning in on hot-button issues such as migration, net zero and gender — shows a party focused more on contentious debate than the quiet, boring work of government. This is in stark contrast to Labour, which tried to avoid ideological spats in 2023 and 2024 in favor of technocratic preparations for power (which Labour officials later complained were a disaster). Much of this is just basic political strategy. Polls show Reform’s lead, while still substantial, has narrowed in recent months and there are more votes in migration and economic policies than in having spokespeople on foreign affairs or defense (both roles remain unfilled). Some things will also take time. Reform’s policy teams have long been thinly-staffed, though the party hired 25 new staff at its London HQ who started in January, said two people briefed on the detail (and granted anonymity to speak freely). A third person briefed on the details said the party is planning to work up detailed energy and business policies in time for its conference in September. But ultimately, Farage focuses on issues such as migration and supposed liberal creep because he feels strongly about them, and has done so for decades. His choices today show Britain will have a more radical, ideologically-driven government if he is prime minister. 2) THE RUBBER WILL START HITTING THE ROAD Farage and his allies announced a blizzard of policy ideas, but without firm decisions or timings, and questions will now grow about how Reform will get there and when. Tice said he wants GDP growth of 3 to 4 percent per year and to bury “net stupid zero” climate rules. He vowed to work up an industrial strategy focused on areas such as steel and car-making, and promised a “British sovereign wealth fund,” with more details to be unveiled next week. All this will require trade-offs. Tice wants to strip away regulation; the property tycoon questioned in November whether 30,000 pages of EU-derived financial sector rules could be stripped back to 100 pages. But at the same time, Reform does not rule out state involvement in strategic heavy industries. (Farage denied this would be “socialism.”) Likewise, Jenrick said taxes are “clearly too high” and promised to “build an economy that serves alarm clock Britain” — people who get up early for work — but was thin on the detail of any specific tax cuts. Fundamental questions about the shape of policy or the economy under Reform have yet to be answered. Four groups are due to finish work in May on regulation, growth capital, pensions and savings, and tax. Farage and Tice have toyed with the idea of scrapping the “triple lock” (which guarantees large increases in the state pension) but have not reached a conclusion. Braverman said 50 percent of young people should enter manual trades, while Tice has suggested a complete overhaul of pensions for public sector workers; these policies are yet to be fleshed out. At the same time, Farage’s appointees have their hands full — especially Tice, whose theoretical super-department would cover business, trade, energy and housing policy. He is also still in charge of Reform’s cost-cutting efforts in local councils. Some basic questions about personnel remain unanswered, too. Yusuf did not clarify at Tuesday’s event whether his role as “head of policy” remains intact. And as neither an MP nor a member of the House of Lords, Yusuf — a tech-investing millionaire — will not be required to declare his outside interests while running Reform’s home affairs policy, which could lead to more scrutiny of him personally. 3) FARAGE IS FIGHTING HARD IN THE CULTURE WARS Farage and his allies continue to take a leaf out of U.S. President Donald Trump’s book, doling out hardline policies and rhetoric on contentious issues — and picking strategic fights with journalists. Yusuf reiterated Reform’s plan for mass deportations, calling recent immigration the “most profound betrayal of the British electorate in history,” claiming people have “literally died” as a result. He promised that the U.K. would not just leave the European Convention on Human Rights, but “derogate from every international treaty that would otherwise then be used to frustrate and upend deportations.” That could be a long list. Braverman said “social transitioning” for gender-questioning children — where they change their pronouns, clothes or name — would be “absolutely banned in all schools, no ifs, no buts.” She also said Reform would abolish the equalities department “on day one,” repeal the 2010 Equality Act and abolish the “pernicious, divisive notion of protected characteristics,” which set down the terms of workplace discrimination in law. While these policies bear similarities with the Conservative Party, they are designed to go a step further and show that Reform is serious about tearing up many of the agreed-upon rules that have underpinned British policy and politics for decades. 4) … BUT HE’S ALSO DESPERATE TO WIN VOTERS’ TRUST Reform’s whole strategy on the economy is to reassure voters that it can be credible. Farage tore up £90 billion of promised tax cuts from his party’s 2024 manifesto in the name of fiscal credibility, despite saying today that he wants to upend the “prevailing economic orthodoxy” of the last few decades. The Conservative Party sensed this weakness last fall and moved to position itself as the reliable choice on the economy. Reform strategists know that it is one of the Tories’ advantages in polling, and a vulnerability in their own reputation that must be patched. They will partly know this because Jenrick himself was a prominent Tory until only a few weeks ago. The new “shadow chancellor” — who will re-state his own reassurance message in a press conference on Wednesday — said in September that he was “terrified” of a financial crash on the scale of 2008. Today, he promised a “government in waiting that can be trusted with the economy” and will work up policy in conversation with business. Hence, the details of any tax cuts under Reform remain vague and will be a key point of tension if Farage ever enters Downing Street. The leader said today that he “might” support tax breaks for people who have “quite a few children.” If he were PM, that sort of comment would lead news bulletins for days. Tice has called for “mad ideas” from the business community to support his deregulation drive. There are other areas where Reform wants to reassure. In her vision of the education system, Braverman promoted the Michaela Community School in north-west London, which the Tories have repeatedly looked to for inspiration. And Farage has long distanced himself from the far-right activist Tommy Robinson, knowing of his toxicity with center-ground voters. Perhaps the biggest bid at reassurance is hauling in former Tories. Jenrick and Braverman defected recently. Thatcherite Tice was a Conservative until 2019 and Yusuf only left the party in 2024. There could be more defectors to come, given the defense and foreign affairs jobs have been conspicuously left open. 5) THE ‘ONE-MAN BAND’ CHARGE IS STICKING Farage used the event to show that his party will have “a little bit less of me,” in his words: “If I was hit by a bus tomorrow, Reform has its own brand, Reform has its own identity.” Yet Farage has always struggled to shake off his own fame and done little to dispel it. Of the five lecterns arranged in a V-shape, his was the most prominent, central and closest to the audience. He repeatedly answered questions that were directed at his colleagues, and joked that if they are “disloyal,” they “won’t be here very long.” While Farage is more an electoral strategist than a deep policy thinker, some believe his picks simply reinforce his dominance over his party (for now). For example, Yusuf has so far focused much of his energy on tech and economic policy, while Jenrick has not held an economic brief for several years. One senior figure involved in Reform said of Jenrick’s appointment: “It’s a clear sign by Nigel that he doesn’t want an imperial chancellor like Gordon Brown or George Osborne. This is a statement that growth policy is going to be driven out of the business department.” There are plenty more appointments to come. But quite simply, there won’t be room in the spotlight for everyone — and much of that spotlight is taken up by Farage himself.  James Orr, a senior advisor to Farage, perhaps put it best last September, saying: “Don’t underestimate how much effect a small band of dedicated people in the cockpit of the nation can do.” That cockpit just got a little bigger; now Reform just has to decide who is at the controls. Noah Keate and Andrew McDonald contributed reporting.

Listen on * Spotify * Apple Music * Amazon Music Rixa Fürsen und Gordon Repinski analysieren und bilanzieren den Samstag auf der Münchner Sicherheitskonferenz. Die Ansprache des US-Außenministers Marco Rubio war versöhnlicher als viele erwartet hatten. Wie schon bei JD Vance vor einem Jahr ging es um Sicherheit und Migration, zugleich betonte Rubio das gemeinsame Wertefundament zwischen Europa und den USA. Gordon und Rixa ordnen ein, was diese Rede für das transatlantische Verhältnis bedeutet, wie sie aufgenommen wurde und sie sprechen darüber, wie die Ukraine in Rubios Rede keine Rolle spielte. Parallel bestimmte eine weitere Nachricht den Konferenztag. Neue Untersuchungsergebnisse legen nahe, dass Alexei Nawalny eindeutig vergiftet wurde. Gordon hat im POLITICO Pub mit seiner Witwe Julia die Erkenntnisse gesprochen, über politische Verantwortung und über die Frage, ob es eine Opposition in Russland geben kann. Auch Wolodymyr Selenskyj äußert sich auf der Pressekonferenz zur Debatte um Nawalny und setzte dabei klare Prioritäten. Im Pub trafen US-Senatoren, NATO-Vertreter und europäische Spitzenpolitiker aufeinander. Die Diskussionen drehten sich um Verteidigungsfähigkeit, strategische Fehlannahmen in der Kriegsprognose und die Rolle Europas in einer sich verändernden Sicherheitsordnung. Und: Ein Blick hinter die Kulissen der Konferenz, von Begegnungen mit internationalen Spitzenpolitikern bis zum traditionellen Kickerturnier der Münchner Sicherheitskonferenz. Das Berlin Playbook als Podcast gibt es jeden Morgen ab 5 Uhr. Gordon Repinski und das POLITICO-Team liefern Politik zum Hören – kompakt, international, hintergründig. Für alle Hauptstadt-Profis: Der Berlin Playbook-Newsletter bietet jeden Morgen die wichtigsten Themen und Einordnungen. ⁠Jetzt kostenlos abonnieren.⁠ Mehr von Host und POLITICO Executive Editor Gordon Repinski: Instagram: ⁠@gordon.repinski⁠ | X: ⁠@GordonRepinski⁠. POLITICO Deutschland – ein Angebot der Axel Springer Deutschland GmbH Axel-Springer-Straße 65, 10888 Berlin Tel: +49 (30) 2591 0 ⁠information@axelspringer.de⁠ Sitz: Amtsgericht Berlin-Charlottenburg, HRB 196159 B USt-IdNr: DE 214 852 390 Geschäftsführer: Carolin Hulshoff Pol, Mathias Sanchez Luna

ALDEN BIESEN, Belgium — The European Union should open up more to its trade partners in public procurement and curb Chinese investment in sectors like green tech, according to a new draft of a landmark industry act obtained by POLITICO on Thursday. Free-trade partners like the United Kingdom and Japan will breathe a sigh of relief as the draft Industrial Accelerator Act (IAA) foresees a definition of “Made in EU” that includes “trusted partners.” Brussels wants to throw up a higher barrier to investment from China by imposing a cap on foreign direct investment by countries that dominate a given global industry. The leak of the bill came as EU leaders held a retreat at a Belgian castle to wargame ways to reverse the bloc’s industrial decline in the face of China’s export dominance and America’s tech supremacy. European Commission President Ursula von der Leyen is trying to find a balance between France’s protectionist instincts and calls for more openness led by Germany, Italy and the EU’s Nordic contingent. Leaders played down differences as they gathered at the Alden Biesen estate, with Italian Prime Minister Giorgia Meloni saying her views on industrial strategy converged with those of German Chancellor Friedrich Merz, and brushing off suggestions the duo were trying to isolate French President Emmanuel Macron. “It is not something that we do against someone else, by excluding someone else,” she told reporters. Leaders reached a form of consensus on areas including the concept of a European preference, where there was openness to examining what it may mean and where it may be needed, according to a person briefed on the talks. The meeting kicked off an intense month of politicking on restoring EU competitiveness and its single market project, with the IAA due out on Feb. 25 and leaders to reconvene for a full-blown summit on March 19-20. The draft drew a swift and strong rebuke from Chinese business. “The latest version of the Industrial Accelerator Act is likely to undermine the investment confidence of leading Chinese companies,” the Chinese Chamber of Commerce to the EU said. “Beyond the political signaling, many of the proposed measures raise serious practical concerns, including the feasibility of mandatory local partnership requirements, which in many cases may simply not be commercially or technologically viable.” A big question mark over the industry push, which is being led by Industry Commissioner Stéphane Séjourné, is whether it can be sufficiently decisive to turn the economic tide. “Whatever new FDI rules will be enacted will be ineffective,” said Yanmei Xie, a senior associate fellow at the Mercator Institute for China Studies. Each EU member country has a different agenda and building a united front against Chinese dominance is a near impossibility. “Whoever is the lowest denominator becomes the de facto gatekeeper.” TRUSTED PARTNERS The latest draft of the IAA, which runs to 96 pages, broadens the definition of a European preference as it would apply to public procurement and other taxpayer-funded programs in energy-intensive industries, net-zero technologies and the automotive sector. In so doing it should allay fears among friendly trading nations of a “Fortress Europe” scenario.  The scope of Made in EU should include content originating from the EU and the European Economic Area, which spans Norway, Iceland and Liechtenstein. The draft also leaves the door open to “trusted partners” whose manufacturing “should be deemed equivalent to Union origin content.” Earlier on Thursday, Séjourné dismissed the notion that the Made in EU push would exclude trade partners. His cabinet said there was broad support, both politically and in industry for the work of the Commission, although “opinions diverge on the conditions and modalities of its implementation.” A broader Made in EU concept will be welcome in the U.K. after the country’s finance minister, Rachel Reeves, said on Wednesday that Britain needed to be part of the Made in EU club. “I actually support the idea of some sort of ‘Made in Europe’ or ‘Made in countries that share each other’s values,’” she told an event. Japan, a major auto exporter, will also welcome the shift. The country “very much meets the definition of a Trusted Partner of the EU,” Patrick Keating, Honda Europe’s head of government affairs, told POLITICO.  GETTING TOUGHER The EU executive doubled down on its efforts to curb foreign direct investments from China in its latest draft.  Should the current form hold, the IAA would limit investments by companies based in countries that control more than 40 percent of global manufacturing capacity across four sectors: batteries, electric vehicles, solar technologies, and the processing and recycling of critical raw materials. “The sectors indicated — those in which Beijing is a leader — as well as the reference to the 40 percent manufacturing capacity, highlight how the increasingly clear target of these measures are Chinese foreign direct investments,”said Luca Picotti, a lawyer at Italy’s Osservatorio Golden Power. The Commission’s proposal, which effectively mirrors Beijing’s 1980s forced joint venture policy, remains in the new draft. Chinese automakers that could be forced to give up some of their technology to their European competitors are pushing back on that strategy. BYD CEO Stella Li has called the model “outdated.” “It’s not efficient: We take decisions in a second, a joint venture takes months. It’s a model of the past,” she told Italian daily Corriere della Sera at the Davos World Economic Forum last month. Governments would also be compelled under the IAA to buy more climate-friendly materials, though the scope of the requirement remains elusive in the latest draft of the upcoming industry booster. The act also proposes introducing voluntary green steel labels.  The scale of the Commission’s intervention remains unclear in the draft, which is missing a section devoted to specific materials as well as a set of annexes, though hints are sprinkled throughout the document. “Public procurement is a powerful lever,” von der Leyen told industry representatives at an event in Antwerp on Wednesday, noting it amounts to 15 percent of EU GDP. “This is massive financial firepower controlled by European governments. But too often, we see that our public buyers have to take the subsidized foreign products instead of the high-quality European alternatives. That is homegrown value that we are leaving on the table.”  Aude van den Hove reported from Alden Biesen, Francesca Micheletti, Jordyn Dahl and Sebastian Starcevic from Brussels, and Zia Weise from Antwerp.

EU leaders on Thursday head to Alden Biesen castle in the Belgian countryside for a retreat to discuss how to make Europe more competitive as it seeks to reduce dependence on Donald Trump’s America. Slashing red tape will be a major focus of the talks, and on Wednesday, European Commission President Ursula von der Leyen said that EU countries, not just Brussels, are to blame for excessive rules. Scroll down for the latest news and analysis.

Lucas Guttenberg is the director of the Europe program at Bertelsmann Stiftung. Nils Redeker is acting co-director of the Jacques Delors Centre. Sander Tordoir is chief economist at the Centre for European Reform. Europe’s economy needs more growth — and fast. Without it, the continent risks eroding its economic foundations, destabilizing its political systems and being left without the strength to resist foreign coercion. And yet, despite inviting former Italian prime ministers Mario Draghi and Enrico Letta to discuss their blueprints to revive the bloc’s dynamism, member countries have cherry-picked from the pair’s recommendations and remain firmly focused on the wrong diagnosis. Europe, the current consensus goes, has smothered itself in unnecessary regulation, and growth will return once red tape is cut. The policy response that naturally follows is deregulation rebranded as “simplification,” with a rollback of the Green Deal at its core. This is then combined with promises that new trade agreements will lift growth, and ritual invocations of the need to deepen the internal market. But this agenda is bound to disappoint. Of course, cutting unnecessary red tape is always sensible. However, this truism does little to solve Europe’s current malaise. According to the latest Economic Outlook from the Organisation for Economic Co-operation and Development, the regulatory burden on European business has risen only modestly over the past 15 years. There has been no explosion of red tape that could plausibly account for the widening growth gap with the U.S. And even the European Commission estimates that the cost savings from its regulatory simplifications — the so-called omnibuses — will amount to just €12 billion per year, or around 0.07 percent of EU GDP. That isn’t a growth strategy, it’s a rounding error. New free trade agreements (FTAs) won’t provide a quick fix either. The EU already has FTAs with 76 countries — far more than either the U.S. or China. Moreover, a recent Bertelsmann Stiftung study showed that even concluding pending deals and simultaneously deepening all existing ones would lift EU’s GDP by only 0.6 percent over five years. From Mercosur to India, there’s a strong geopolitical imperative to pursue agreements, and in the long run they can, indeed, help secure access to both supply and future growth markets. But as a short-term growth strategy, the numbers simply don’t add up. The same illusion shapes the debate on deepening the single market. Listening to national politicians, one might think it’s an orchard of low-hanging fruit just waiting to be turned into jars of growth marmalade, which past generations simply missed. But the remaining gaps — in services, capital markets, company law and energy — are all politically sensitive, technically complex and protected by powerful vested interests. The push for a Europe-wide corporate structure — a “28th regime” — is a telling admission: Rather than pursue genuine cross-border regulatory harmonization, policymakers are trying to sidestep national rules and hope no one notices. But while this might help some young firms scale up, a market integration agenda at this level of ambition won’t move the macroeconomic needle. From Mercosur to India, there’s a strong geopolitical imperative to pursue agreements, and in the long run they can, indeed, help secure access to both supply and future growth markets. | Sajjad Hussain/AFP via Getty Images A credible growth strategy must start with a more honest evaluation: Europe’s economic weakness doesn’t originate in Brussels, it reflects a fundamental shift in the global economy. Russia’s invasion of Ukraine delivered a massive energy price shock to our fossil-fuel-dependent continent. At the same time, China’s state-driven overcapacity is striking at the core of Europe’s industrial base, with Chinese firms now outcompeting European companies in sectors that were once crown jewels. Meanwhile, the U.S. — long Europe’s most important economic partner — is retreating behind protectionism while wielding coercive threats. With no large market willing to absorb Europe’s output, cutting EU reporting requirements won’t fix the underlying problem. The continent’s old growth model, built on external demand, no longer works in this new world. And the question EU leaders should be asking is whether they have a plan that matches the scale of this shift. Here is what that could look like: First, as Canadian Prime Minister Mark Carney argued at Davos, economic strength starts at home — and “home” means national capitals. Poland, Spain and the Netherlands are growing solidly, while Germany is stagnating, and France and Italy are continuing to underperform. What is seen as a European failure is actually a national one, as many of the most binding growth constraints — rigid labor markets, demographic pressure on welfare systems and fossilized bureaucracies — firmly remain in national hands. And that is where they must be fixed. It’s time to stop hiding behind Brussels. Next, Europe needs a trade policy that meets the moment. Product-by-product trade defense can’t keep pace with the scale and speed of China’s export surge, which is threatening to kill some of Europe’s most profitable and innovative sectors. The EU must move beyond microscopic remedies toward broader horizontal instruments that protect its industrial base without triggering blunt retaliation. First, as Canadian Prime Minister Mark Carney argued at Davos, economic strength starts at home — and “home” means national capitals. | Harun Ozalp/Anadolu via Getty Images This is difficult, and it will come with costs that capitals will have to be ready to bear. But without it, Europe’s core industries will remain under acute threat of disappearing. Moreover, trade defense must be paired with a rigorous industrial policy. The Green Deal remains the most plausible growth strategy for a hydrocarbon-poor continent with a highly educated workforce. But it needs clarity, prioritization and sufficient funding in the next EU budget at the expense of traditional spending. “Made in Europe” preferences can make sense — but only if they’re applied with discipline. Europe must be ruthless in defining the industries it can compete in and be prepared to abandon the rest. That was the Draghi report’s core argument. And it boggles the mind that the continent is still debating European preferences in areas like solar panels, which were lost a decade ago. Finally, deepening the single market in earnest isn’t a technocratic tweak but a federalizing choice. It means going for full harmonization in areas that are crucial for growth. It means taking power away from national regimes that serve domestic interests. Any serious reform will create losers, and they will scream. That isn’t a bug — it’s how you know the reform matters. In areas like capital markets supervision or the regulation of services, leaders now have to show they’re willing to act regardless. And unanimity is no alibi: The rules allow for qualified majorities. EU leaders must learn to build them — and to live with losing votes. EU leaders face a clear choice tomorrow: They can pursue a growth agenda that won’t deliver, reinforcing the false narrative that the EU shackles national economies and giving the Euroskeptic extreme right a free electoral boost. Or they can confront reality and make the hard choices a bold agenda calls for. The answer should be obvious.