Welcome to Better Europe’s weekly update on EU Affairs.
EU TRADE MINISTERS PREPARE FOR TRUMP’S TRADE TANTRUMS
In a diplomatic dance to dodge Trump’s trade tirades, EU ministers for trade, the internal market, and industry huddled in Warsaw on Tuesday, seeking strength in unity against the U.S. president’s “tariff” threats. Polish Economy Minister Krzysztof Paszyk set the tone: “We have to stick together, otherwise Trump’s trade tornado will blow us away like yesterday’s news. “The summit exposed familiar cracks in EU solidarity. While most members and the Commission support the Mercosur deal, France remains the party pooper. The EU is now eyeing Malaysia, India and Indonesia for trade talks, hoping to diversify and avoid putting all its eggs in one basket. “The US trade stance is changing by the hour,” noted Trade Commissioner Maroš Šefčovič, highlighting the challenge of negotiating with such a wild card. Luxembourg’s Foreign Minister Xavier Bettel offered a survival guide: “If you’re weak, Trump will eat you. If you don’t negotiate, he’ll kill you. We have to make sure he loses his appetite for Europe.” As the EU navigates these choppy waters, the hope is that diplomacy and diversification will keep the bloc afloat amid Trump’s trade storm, and that the EU’s unity will help to call Trump’s bluff.
LEAKED WORK PROGRAMME CONFIRMS OMNIBUS TRIO
A draft of the Commission’s Work Programme for 2025 is circulating in Brussels, offering a detailed look at the initiatives, proposals, and repeals that will shape the EU’s agenda this year. The draft shopping list includes three omnibus proposals, a revision of the SFDR and the launch of the Clean Industrial Deal. In addition, the work programme outlines new rules for AI policy, as well as initiatives on health and migration. A simplification package for the Common Agricultural Policy (CAP) is also part of the plan. While the document may not be fully up to date, it gives a clear indication of the Commission’s focus for the coming year. The final version of the work programme is expected to be adopted by the Commission and presented by President Ursula von der Leyen in Strasbourg next week, on 11 February. This first glimpse underlines the EU’s strategic priorities and reflects its commitment to growth, innovation and efficiency as it prepares for an important year ahead. As regards omnibuses, three of them are calling in Brussels this year – beyond the highly debated one on sustainability, we’ll get one on “investment simplification” and another one on small mid-caps and the “removal of paper requirements”; we’re hoping this is the long-awaited Anti Fax Directive.
SAVINGS AND INVESTMENT UNION WITH THE HANDBRAKE ON
The Commission is confident that it’s Savings and Investment Union package is ready and eagerly awaited by the market. The proposal is has now been advanced by two weeks and is expected to consist of a horizontal communication, with one immediate legislative proposal on relaunching securitisation, as well as an action plan with plenty of other legislative and mostly non-legislative initiatives. We knew for a long time that securitisation would be back, baby, and this time safe and sound. But on the two other major pillars described in the final consultation, retail finance and joint supervision, things are less clear. The Retail Investment Strategy is stuck in negotiations and could benefit from a revival through the SIU initiative. Beyond a common system for harmonised savings and investment accounts, the Commission’s plans are less clear. Distribution rules will have to be revised if Omnibus 1 kills sustainability reporting, because how can a distributor apply their client’s sustainability preferences if investment products can no longer indicate how green they are, because companies no longer have to report? And on the supervision debate, it’s clear that Member States have been pushing back against bold proposals to create a single financial markets supervisor with offices in all countries – earlier this week, ESMA Chair Verena Ross admitted at their conference that it would already be great to consider “elevating” supervision to the EU-level for “certain categories of firms”; quite a step back from calls to create a unified supervisor.