European Commission President Ursula von der Leyen confronts intense scrutiny as she delivers her State of the Union address, grappling with the fallout from a contentious trade deal with U.S. President Donald Trump and a complex global environment. This pivotal speech must balance European strategic interests with public discontent, defining her second term amidst calls for decisive leadership and unity.
Re-elected, von der Leyen faces a precarious balancing act. She must project resolute leadership while appeasing lawmakers, businesses, and voters who perceive the U.S. trade deal as disadvantageous. Her Strasbourg address will outline the bloc’s direction, prioritizing stronger European defense (with new investment and enhanced coordination amid global insecurity) and bolstering economic competitiveness against China to safeguard jobs.
An intensified approach to Ukraine is anticipated, including sustained financial and military aid and stricter Russian sanctions. The speech will also focus on EU climate policy and digital transition, aiming to portray the bloc as green and technologically advanced. For businesses, concrete steps to streamline regulations and implement former ECB chief Mario Draghi’s competitiveness plan are critical.
The Contentious U.S. Trade Agreement
The core controversy stems from the trade agreement with President Trump, finalized in July at Turnberry. The deal saw the EU eliminate tariffs on U.S. industrial goods and reduce barriers for farm products. In response, Trump imposed a 15% tax on most EU products, revoking prior low or zero duties.
European reaction has been negative. Former French Prime Minister François Bayrou labeled it an “act of submission.” A poll showed 77% in the EU’s five largest economies view the deal as favoring the U.S. (compared to 2% for Europe). Over half support boycotting U.S. products; some are calling for von der Leyen’s resignation.
Officials defend the pact as a necessary compromise, averting a trade war and providing business certainty, which is crucial given vital U.S. security guarantees. However, significant parliamentary opposition persists, with Socialists and Greens accusing von der Leyen of capitulating. Even within her center-right European People’s Party, unease is evident.
Alberto Alemanno, HEC Paris professor of EU law, suggests von der Leyen is a scapegoat, arguing her position reflects the EU’s institutional weaknesses, not personal failings. He cites her inability to unilaterally retaliate against the U.S., decisively respond to Gaza, or broker peace in Ukraine.
Navigating the Path Forward
The State of the Union is crucial for von der Leyen to reset the agenda and galvanize support amidst public unrest. She will emphasize the EU’s global role, its commitment to defending Ukraine, and its influence on trade and climate regulations. However, the shadow of the Trump deal makes restoring public trust the central challenge. A parliamentary debate will follow, with markets, industry, and allies monitoring the EU’s strategy on conflicts, trade, and global competition. This address is poised to be her most challenging.
Jonathan Reed received his MA in Journalism from Columbia University and has reported on corporate governance and leadership for major business magazines. His coverage focuses on executive decision-making, startup innovation, and the evolving role of technology in driving business growth.