Dear Friends,
For years, the EU was known as the quiet superpower of global regulation. It didn’t dominate through troops or tariffs, but through standards. From chemicals and data protection to climate rules, the so-called “Brussels Effect” meant that when the EU regulated, the world often followed.
Now, across multiple fronts, the EU’s rules are being challenged. The United States and Qatar have called on Brussels to roll back its due diligence rules. Countries in the Global South are pushing back against the EU’s anti-deforestation law and carbon border mechanism. While tech bros insist the EU water down its digital rulebook. Instead of Europe shaping the world, the world is increasingly shaping Europe. Or, as Gideon Rachman recently put it: “The scramble for Europe is just beginning".
The core of the issue is that the EU is a rules-based power in an increasingly unruly, power-based world. Europe’s instinctive response to power politics is often moral outrage and indignation - how dare they! We have seen this again in recent trade and tech skirmishes, when EU officials accused Washington of “blackmail” after US Commerce Secretary Howard Lutnick suggested that the United States might ease steel tariffs if the EU softened parts of its digital rulebook.
Outrage may feel righteous, but it is rarely a strategy towards a positive outcome. In power politics, indignation often signals vulnerability rather than strength.
Europe, however, is not weak. Biggest market in the world. Second most important global currency in the world (more on that below!). Producer of critical materials and machines. Without lithography from ASML, you can have all the rare earths in the world and won’t produce a single chip.
The global data-centre boom, including in the United States, runs largely on European power engineering. European companies build the infrastructure that the American cloud runs on. Schneider Electric, Siemens, ABB, Legrand, and others dominate markets for grid connection, transformers, switchgear, UPS systems, cooling and thermal management; all necessary for the physical infrastructure of data centres.
Yet what Europe often lacks is not capability, but the willingness to think and act in terms of power.
This hesitation shows up not only in trade and industrial policy, but also in security. For years, Europe has been the target of Russian hybrid attacks: assassinations in public spaces, railway sabotage, disinformation campaigns, GPS jamming, drones shutting down airports. The response? Mostly condemnation and resilience talk. Now, finally, a new debate is emerging about whether Europe should also develop credible offensive cyber and hybrid capabilities. This is a mindset shift that is long overdue.
Europe has great cards. It just too often refuses to play them. You don’t win at the poker table if you constantly fold.
In that vein, I invite you to read our latest Böll EU Brief “Green Euro Rising”, which outlines how the euro can become the world’s green currency. We have also just published a new dossier on the EU’s long-term budget (MFF), offering in-depth analyses on the climate and social dimension.
One of our core projects, carried out in cooperation with the Green European Foundation, has focused on empowering citizens to actively shape, and benefit from, the energy transition. We are proud to have just released a set of new policy briefs on strengthening citizen participation in the energy transition, together with a dedicated infographic.
Warm regards,
