Belgian Foreign Minister Hajja Rahbib posed with European flags inside a mock polling station box to encourage people to vote in the upcoming European elections.
Laurie Diefenbach | AFP | Getty Images
The EU’s political makeup is about to change as voters in 27 member states go to the polls from Thursday to Sunday.
As support for far-right parties grows, analysts expect the EU to adopt more protectionist policies, reduce climate targets and increase defense spending.
CNBC explores why this election matters for Europe and the rest of the world.
Relations with the United States
EU lawmakers and officials generally hailed the election victory US President Joe Biden returns to 2020, viewing it as a new dawn in transatlantic relations. Until then, European officials had been facing major challenges from the previous administration under Donald Trump, which imposed trade tariffs, divided on climate commitments and shocked mainstream politicians with its combative style.
As American voters go to the polls in November, the future of the transatlantic relationship remains uncertain, and it remains to be seen whether Biden will remain in the White House or Trump will return.
But whatever happens, the EU has learned an important lesson: It may not be able to rely on the United States for its defense in the future. Trump has previously said he would not protect NATO countries from Russian attacks if they defaulted on membership dues. Additionally, U.S. lawmakers took months to approve new financial aid to Ukraine, raising questions about its long-term commitment.
As a result, the EU’s next policymakers are expected to increase spending and work more closely together on defense matters.
relations with china
The European Commission, the EU’s executive arm, is expected to announce new tariffs on Chinese electric vehicles days after the election.
The EU has always walked a tightrope in its relationship with China.
On the one hand, Brussels recognizes Beijing as a strategic competitor, but at the same time, it hopes to maintain cooperation on climate issues and geopolitical issues.
Green commitment
After the 2019 EU elections, the group claimed to be a global champion of a climate-friendly agenda. However, as more climate-skeptic politicians arrive in Brussels, the EU is expected to relax some of its previous ambitions.
“A rightward shift in the EU Parliament will only slow down further environmental legislation and could even weaken existing agreements, such as phasing out conventional cars by 2035,” Citi analysts said in a research note in late May.
They added: “This could include more support for nuclear power or even support for fracking for cheaper, more reliable natural gas.”
Italian Prime Minister Giorgia Meloni during the final campaign rally of the Brothers of Italy party ahead of the European elections on Saturday, June 1, 2024 in Rome, Italy.
Bloomberg | Bloomberg | Getty Images
Ukraine’s future
Following Russia’s invasion of Ukraine, Kyiv applied for EU membership, with formal negotiations likely to begin as soon as this month.
While the process may take many years to complete, it already raises the question of how much the EU will need to change to accept Ukraine and other new members.
It is widely believed that the EU must take qualified majority Get things done instead of looking for the usual consensus. This means that decisions can be taken without unanimous consent, as decision-making becomes more challenging as the number of member states increases.
Citi analysts also said that with Ukraine potentially joining the EU, “net contributions could change dramatically”, which could unsettle current net recipients of the EU budget.
“A larger Eurosceptic representation could also stymie bold reforms, which could make it difficult to expand the economy,” analysts said.
“This is the economy”
within europe A survey in March showed Citizens view the economy, social justice and employment as the most important aspects of Europe’s future.
This is particularly important at a time when the eurozone is still recovering from the inflationary crisis that dominated much of 2023.
Goldman Sachs said in a May research report that the EU faces three structural problems: worsening demographic prospects, weak industrial investment compared with the United States, and slow productivity growth.
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