Against a backdrop of acute uncertainty, weak growth, subdued wages, and elevated market interest rates, monetary tightening is warranted only when there is convincing evidence that higher inflation is becoming entrenched. No such evidence has yet materialized in Europe.
Read my latest column for Project Syndicate
Relations have certainly improved, as has security cooperation. But progress on economic cooperation remains meagre.
Practical and political hurdles include:
What might break this deadlock?
A pro-EU shift in the UK. Starmer’s weakness is pushing him towards closer alignment with the single market, while his leadership rivals favour a customs union with the EU.
But given Labour’s red lines, any big shift would likely come only in its next manifesto – and only be implemented if Labour wins the next election, which must be held by 2029.
The EU’s position may also evolve. Fast-tracking Ukraine’s entry by offering it a form of associate membership sets a precedent that could be applied elsewhere. In the wake of Trump’s rupture of the global order and Western alliance, the EU is looking at ways to cooperate more closely with allies such as Canada, which could prompt fresh thinking about institutional flexibility.
The biggest catalyst for change could be an even greater sense of common threat – eg, if Trump quits NATO.
But so far there hasn’t been a strategic discussion on the underlying issue of how to protect liberal democracy from the forces trying to destroy it, and how the EU-UK relationship fits into that.
It would make sense for the UK to rejoin the EU but sadly that still seems a distant prospect.
Read my latest piece for the Brussels Times.
In the 1970s, two big oil shocks sent inflation soaring and depressed Europe’s economy. Could history be about to repeat itself?
Read my latest for Brussels Times.
Donald Trump likes to call himself “Tariff Man” and even “king”. But on 20 February, the US Supreme Court ruled that his use of particular emergency powers to “unilaterally impose tariffs of unlimited amount, duration and scope” on all and sundry was illegal.
That setback throws much of Trump’s trade strategy into chaos, deprives him of his favourite form of geopolitical leverage and constrains his freedom of action going forward. He is not, after all, an absolute monarch when it comes to commerce.
The justices’ ruling also casts doubt on the many trade agreements that are premised on Trump’s unilateral tariffs – not least his one-sided deal with the EU that was struck at his Turnberry golf course in Scotland last August.
But while the Supreme Court’s willingness to stand up to Trump is good news – not least for Americans worried about their country’s accelerated slide into authoritarianism – it does not prevent Trump achieving his protectionist aims by other means. Indeed, if it prompts Trump to lash out and other countries to retaliate, it might even end up making matters worse.
Read my article for Brussels Times.
EU leaders have just gathered for yet another discussion on how to make Europe’s economy more “competitive”. That’s the wrong target; the aim should be to make the EU more dynamic.
While the EU has suffered big external shocks in recent years – Russian energy, US tariffs, Chinese competition – the core problem is its corporatist economic model, which favours established companies in mature industries over innovative startups in growth sectors like tech.
While many things need to change, at EU level there are 3 big levers for economic reform: deeper integration in the EU’s incomplete single market; lighter-touch regulation for smaller companies and innovative sectors; and increased investment, not least in venture capital.
Read my latest column for Brussels Times.
The price of gold has plunged over the past week, but is still up more than 10% this year and has nearly doubled since the start of 2025.
Is it just a bubble? Or are there sound reasons for gold’s safe-haven appeal?
Clearly, speculation is part of the story. FOMO has amplified fear of geopolitical & financial turmoil.
But in a time of war and Western sanctions, geopolitical upheaval & loss of trust in the dollar, gold is also a valuable form of insurance that has stood the test of time.
And it can also offer a decent return. Ignoring the past year’s exuberance, gold appreciated by an average of 9% a year between Jan 2000 & Jan 2025.
The caveat: if gold becomes a more mainstream financial asset, it may lose some of its safe-haven properties.
Read my latest column for The Brussels Times
The storm over Greenland may have abated for now, but Europe’s relations with Donald Trump remain grim.
Europeans need to face facts: they cannot rely on the mercurial US president to protect them from Russia; indeed, he too poses a threat.
Now, then, is the time to accelerate plans to reduce Europe’s military, economic and technological dependence on Trump’s America and to build new partnerships with like-minded powers.
Read my latest Brussels Times column.
Against the new global backdrop of American aggression, Chinese chokeholds and proliferating protectionism, both the EU and the South American countries of Mercosur have powerful reasons to build new partnerships that bypass the US and provide alternatives to China.
Read my Brussels Times column.
When in 2019 Donald Trump first suggested that the US acquire Greenland, Europeans dismissed the idea as a bad joke. But they’re not laughing now.
My latest column for Brussels Times explains why Trump wants Greenland, how he might gain control of it, and what that would mean – not just for Greenland and Denmark, but also for Ukraine and the rest of Europe.
It concludes that in a world governed by force, Europe needs to be able to defend itself – not by 2035, but now.
EU leaders are quick to tweet that they ‘stand with Ukraine’. But talk is cheap. Unless they are willing to follow words with action, Putin will rightly conclude that they are all mouth and no trousers.
There is a compelling case for using Russia’s frozen assets. But the overriding priority is to sustain Ukraine come what may. If all else fails, the EU should simply borrow the money. That is what the Commission is proposing as a stopgap measure, and it could also be a viable longer-term solution.
Read my latest column for The Brussels Times
Trump and Putin negotiating Ukraine’s future without consulting Europeans; the EU capitulating to Trump on trade; European factories choked by China’s rare-earth curbs:
Now that global decisions are increasingly dictated by hard-power realities not technocratic rules, the once-mighty EU suddenly seems like a paper tiger.
Read my latest column for Brussels Times, which analyses the EU’s four big vulnerabilities and sets out what it needs to do to become a superpower.
Later this month, NATO is set to agree targets for higher defence spending, by an as-yet-unconfirmed future date.
But Europe needs to rearm massively, right now. The threat from Putin is imminent, as is the risk that Trump abandons Europe, or betrays it by siding with Putin.
While this will eventually require tax rises and/or spending cuts, the best way to fund such a big emergency boost to defence spending is by borrowing more for a few years, preferably collectively. This could involve a coalition of willing governments, both EU and non-EU.
Done right, this could also help streamline military procurement, better integrate Europe’s fighting forces and even provide a much-needed lift to Europe’s struggling economies.
My latest Substack essay explains how best to do this.
My latest Substack essay analyses Trump’s trade deals with the UK and China, and provides pointers for the EU, Japan and others.
Read my latest Substack essay
As Trump’s destructive chaos leads global investors to desperately search for safe alternatives to US Treasury bonds, the EU has been given an unprecedented opportunity.
In addition to satisfying investor demand, a large issuance of common EU bonds would strengthen Europe’s economy, security, and policymaking autonomy.
Read my latest column for Project Syndicate
Read my latest Substack essay
Trump is destroying the post-1945 economic and geopolitical order that the US created and led. What comes next?
Read my new Substack essay
I debated this on Al Jazeera English’s Inside Story
Watch the video
The FT has published my letter demolishing the nonsense argument by Jason Cummins and the Trump administration that EU VAT gives European exporters an unfair trade advantage.
Cummins claims that it is unfair that BMW does not pay EU VAT on its exports to the US, whereas General Motors must pay VAT on its exports to the EU.
But BMW cars sold in Europe face exactly the same VAT rate as GM ones exported from the US.
Similarly, BMWs and Cadillacs sold in the US face identical state and local sales taxes, and neither pay EU VAT on their US sales.
Cummins ignores the true lack of reciprocity: that the EU levies a 10 per cent tariff on car imports whereas the US levies 2.5 per cent on cars and 25 per cent on light trucks. Equalising all of those at 2.5 per cent would make sense.
Regrettably, Trump has instead announced a 25 per cent tariff on all car imports from April 3. That is “unfair” and “discriminatory”, not EU VAT.
“There’s a new sheriff in town,” declared US Vice President J.D. Vance at this year’s Munich Security Conference. With his boss, “Sheriff” Donald Trump, openly disparaging America’s longstanding security commitments and actively undermining European security, the United States can no longer be trusted, and it is up to Europe’s leaders to bolster the continent’s defense capacity – and fast.
Read this Project Syndicate Big Picture, with a contribution from me.