Dear Readers,
As 2025 draws to a close, Europe approaches the holiday season with more urgency than ease. The past year has brought what many expected at its outset: that a rapidly shifting strategic environment would make the strengthening of Europe’s resilience across economic, political, and security dimensions the defining task.
The European Commission’s newly presented economic security doctrine captures this moment of strategic transition. Europe’s prosperity long rested on openness and deep global integration, yet these foundations have become liabilities as they are increasingly used for leverage. In my recent Handelsblatt column, I argued that the doctrine’s success will depend on whether Member States can align their risk assessments, protect critical technologies, and build the industrial capacity required for long-term resilience. This will demand more coherent coordination between economic, trade, industrial, and security policy, and the political will to act jointly in moments of pressure.
These pressures are particularly evident in Europe’s clean technology sectors, where manufacturers face a double shock: Trump’s policies are cutting U.S. clean tech subsidies and weakening demand for European exports, while Chinese overcapacity is sending a wave of low-priced products into Europe. In their new policy brief, my colleagues Lucas Resende Carvalho and Etienne Höra, together with Elisabetta Cornago and Philipp Jäger, show how this combination is squeezing European firms at home and abroad. Yet they stress that Europe still holds strong positions in several clean technologies. With the right strategy, Europe can remain competitive, even though the window for action is narrowing.
Pressure is also building in Europe’s neighbourhood. The dismantling of USAID earlier this year has abruptly removed a long-standing anchor of democratic and civic support in the Western Balkans and Eastern Partnership. As Brandon Bohrn shows in his new policy brief, hundreds of programmes vanished almost overnight, leaving media, civil society organisations and watchdog institutions exposed precisely when authoritarian influence is rising. This is not simply a development policy challenge but a geopolitical one that requires Europe to recalibrate its approach to the region, close the political and delivery gaps in its own assistance, and invest more consistently in the democratic resilience of actors on the ground. This becomes all the more evident in light of the new U.S. National Security Strategy, which Brandon Bohrn has analysed on Bluesky for its stark adversarial framing of Europe.
Looking ahead to 2026, I expect intensifying geopolitical fragmentation to shape the world, while Europe continues to push for strategic sovereignty under increasingly difficult domestic conditions. AI will become more deeply embedded across economies, societies, and governance, driving productivity but also raising new regulatory, social, and ethical challenges. While states race to invest in resilience, defence, and technological competitiveness amid growing societal polarization, security threats persist and climate risks intensify.
We will continue our work on how the EU can be strengthened internally and how it can reduce strategic dependencies and bolster its resilience. This includes doubling down on technological capabilities, improving competitiveness, and investing in democratic resilience in the face of hybrid threats in order to become a stronger shaper internationally.
Thank you for following our work throughout this extraordinary year. We wish you a peaceful holiday season and a good start into the new year. We are looking forward to working with you in 2026.
Best wishes,
Daniela Schwarzer
Member of the Executive Board
