Blockade instead of strength: The EU summit shows how divided the Europeans are on important issues

Blockade instead of strength: The EU summit shows how divided the Europeans are on important issues The heads of government had set pressing economic issues for their summit. Among them were the high energy prices. But the countries did not come to an agreement. These are the reasons. Actually, the heads of state and government of the 27 EU countries wanted to advance three major dossiers at the summit on Thursday: the high energy prices, the trade balance deficit with China, and the EU budget for 2028 to 2034. But decisions remained out, they left it to the exchange of opinions. They are three big items that politicians have to deal with. However, the lack of results also shows how divided the organization is on central topics. No ideas against the high energy price The price of gas has risen by 180 percent since the outbreak of the Iran war in the spring, and that for diesel has doubled. This has caused unrest among companies and consumers. And the governments feel forced to react. Otherwise, populist movements gain momentum. Almost in despair, individual governments turned to the EU. They want to propose concrete measures to the countries against the dangerously high energy prices. No one has an idea on this frustrating topic, says the representative of a Eastern European EU state. But the EU lacks the instruments to relieve the countries. Some of them would like Brussels to propose a windfall tax for energy companies and then distribute the money to the countries. But the Commission backs away from such a step – it seems arbitrary to it. In the short term, various member states are relieving themselves by lowering energy taxes and thus relieving consumers and companies. But financially, this is a huge burden for them, especially since interest rates for borrowing on the bond markets have recently risen sharply. Greece and Italy therefore want to soften the budget rules applicable in the EU – not for the first time. But the Commission has recently warned the member states that they should also keep an eye on the financing costs on the bond markets. These make the Commission apparently worried. Attacks on the emissions trading fail In view of such constraints, the member states from Eastern Europe particularly would like to make reforms to the EU emissions trading system (ETS). Through these platforms, companies have to buy certificates for certain sectors if they emit the climate-damaging CO2. Polluting the environment should cost something. But in the ETS, the EU is deeply divided. Some countries of Eastern Europe, which relied heavily on coal for decades, are finding that the ETS is expensive. The Commission, on the other hand, strongly wants to stick to it, as do Germany and the Scandinavian countries. Regarding electricity supply, the Northern Europeans are much more aligned than the Eastern Europeans, so the ETS is less burdensome for them. They see the CO2 certificates as more of an incentive to invest in environmentally friendly technology. Efforts by individual member states to adjust the ETS have failed on Thursday. Will France take the money from others? Money was also the big point of dispute at the summit. In June 2025, the EU Commission made the budget proposal for 2028 to 2034, and by the end of this year the budget was ideally supposed to be established. But the countries are far from it. They are arguing about the amount of the budget, the distribution of the money on the various expenditure items, and what additional sources of income the EU should receive. The divides are deep. Germany's Chancellor Friedrich Merz said again on Thursday that the EU Commission must reduce the budget significantly. About six other states see it the same way. The others want to at least maintain or increase the previous expenditures. The latter is what France, plagued by high debt, is aiming for. The budget discussion thus sows discord. A representative of a member state said that France was aiming to spend the money of others. Just as the fundamental problem of the EU budget proves itself, the fact that about 30 percent of the money flows into agriculture is apparent. The majority of member states do not want to shake this up for them, as this distribution is as good as set in stone. But this imbalance in favor of an economically insignificant sector makes budget design for the EU difficult. There is a lack of flexibility to finance new tasks, such as defense or modern technologies. A breather on the China dossier In the short term, the China issue has been somewhat eased. The Asian economic power promised the Europeans a week ago that it would impose restrictions on the export of hybrid and plug-in hybrid vehicles. This year, China's manufacturers will probably export about 800,000 such vehicles to Europe, while in 2027 there will be only 350,000. China skillfully gave the EU this concession shortly before the summit. The government is thus sending the signal that it can talk reasonably with them. At the same time, the concession does not change much about the EU's trade balance deficit, which causes so much concern among most heads of government in the organization. In total, vehicles and parts for their production make up only 5 percent of China's exports to the EU. The problem is therefore far from solved. The EU cannot pull very hard ropes against China because the country would react with countermeasures. And before that, those companies that do business with China are extremely afraid. At the end of November, the EU countries will probably hold an extraordinary summit to discuss all these issues further. However, the budget should be at the center, where the discussion is completely stuck.