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EU Enters 2026 at a Crossroads on Ukraine, Trade and Competitiveness

A volatile election calendar could curb unity on Ukraine, forcing hard choices at home.

Overview

  • Transatlantic friction has intensified as Brussels enforces digital and competition rules and the United States threatens retaliatory tariffs and visa denials, including actions targeting former commissioner Thierry Breton.
  • European and U.S. views on the endgame in Ukraine diverge, with coverage saying the EU has ceded initiative to Washington and now follows President Donald Trump’s lead.
  • Hungary’s April parliamentary vote looms large for EU policy on Kyiv, since both Viktor Orbán’s Fidesz and the leading challenger TISZA oppose sending weapons to Ukraine.
  • China’s expanding export surplus, reported at about $1 trillion in 2025, and its ongoing ties to Russia are heightening commercial and geopolitical pressure on Europe.
  • Years of weak growth — averaging roughly 0.7% to 1.3% annually since 2007 — are fueling regulatory recalibration and raising warnings that higher defense outlays will compete with health care and pensions.