The EU’s New Leadership in 2025: Challenges Without a Strong Franco-German Tandem
By Bernd Riegert
The European Union (EU) faces significant challenges in 2025 under its newly elected leadership in Brussels. With an unstable Germany-France tandem, key questions arise about how effectively the EU can address these issues.
Among the biggest challenges are an embattled Ukraine, an aggressive Russia, and a potential return of Donald Trump as U.S. President. These external pressures are compounded by internal struggles, such as sluggish economic growth, high levels of debt, and political instability in key member states like Germany and France. What lies ahead for the EU’s new leadership team?
A New Team in Brussels
Antonio Costa, the new President of the European Council, and Kaja Kallas, the EU’s High Representative for Foreign Affairs, took office on December 1, 2024. Ursula von der Leyen remains as Commission President, leading a restructured EU Commission. Steven Everts from the European Institute for Security Studies in Paris sees this transition as a chance to recalibrate EU foreign policy: “This is the moment to rethink, adapt, and revitalize the EU’s approach.”
1. Supporting Ukraine
Top of the agenda is financial and military aid for Ukraine, under siege from Russia. The EU plans to send €1.5 billion monthly from its common budget to Kyiv in 2025, alongside a €50 billion G7 loan backed by profits from frozen Russian assets.
EU member states will also need to finance large quantities of ammunition and weapons for Ukraine, a candidate for EU membership. However, uncertainty looms over U.S. support under a potential Trump administration, which could drastically cut or end the current level of American aid. The EU has no clear contingency plan, with diplomats admitting, “We’re not really prepared for Trump.”
2. Strengthening Defense
In 2025, the EU will prioritize its own defense capabilities against Russian aggression. A new EU Commissioner for Defense and Space, Andris Kubilius, aims to improve coordination of arms procurement and supply chains among member states. However, many nations’ defense budgets remain insufficient to meet growing needs.
The situation could become more critical if Trump demands higher European contributions to defense spending. Germany, for instance, faces a €230 billion shortfall in its defense budget over the medium term, according to the IFO Institute. Italy and Spain face similar deficits. Proposals for joint EU borrowing to fund military spending have already been rejected by Germany’s new Finance Minister, Jörg Kukies.
3. Managing Debt
In addition to defense, the EU must address broader financial demands, including green economy investments, economic recovery, and reconstruction in Gaza, Lebanon, and Syria. Former European Central Bank President Mario Draghi has estimated the need for €800 billion in investments to boost EU competitiveness.
Draghi advocates for joint EU borrowing to fund these initiatives, combined with private investment. However, many member states, including France and Italy, are already struggling with EU deficit procedures, while Spain could soon follow. Germany’s fiscal policy remains constrained by upcoming elections, delaying its 2025 federal budget until mid-year.
4. Preventing Trade Wars
Trade relations in 2025 are fraught with potential conflicts. A trade war with China over electric vehicles has already begun, and tensions with the U.S. could escalate due to Trump’s proposed punitive tariffs on Europe, China, Mexico, and Canada.
EU Economic Affairs Commissioner Valdis Dombrovskis warns that a global trade war would harm all parties, reducing global economic output by 7%. He emphasizes the need to present Trump with hard data to deter protectionist policies. Meanwhile, the recently signed trade agreement with Mercosur offers some optimism, but it requires ratification within the EU next year.
5. Maintaining Unity
EU expert Janis Emmanouilidis of the European Policy Centre (EPC) cautions that the EU’s traditional role as a broker of compromises is under threat. He notes a growing shift toward nationalist policies, making it harder to maintain cohesion, particularly on foreign and military issues.
The EU’s internal political landscape adds to these challenges. France is weakened by governmental crises, Germany is constrained by elections, and several other member states face political instability or euroskeptic leadership. Hungary’s Viktor Orban, for instance, promotes closer ties with Russia while celebrating his alignment with Trump.
Outlook for 2025
While the EU’s challenges in 2025 are daunting, they also offer opportunities for renewed strategic thinking. The new leadership in Brussels must navigate these turbulent times with innovation and resilience, striving to preserve unity and relevance in an increasingly fragmented world.
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“KORÇA BOOM”
