State of the Union: Six takeaways from Ursula von der Leyen’s keynote speech

Ursula von der Leyen delivered on Wednesday her annual State of the Union speech, unveiling the principle political priorities for the following working 12 months.

Russia’s warfare in Ukraine and the worsening vitality disaster had been recurring themes within the deal with, giving the big day a markedly sombre undertone.

“As we glance round on the state of the world right now, it may possibly typically really feel like there’s a fading away of what as soon as appeared so everlasting,” she stated.

Nonetheless, von der Leyen additionally injected doses of optimism and made a passionate case for a stronger and nearer union rising from the overlapping crises.

“We’ll succeed – and that success will belong to each certainly one of us,” she famous, quoting the late Queen Elizabeth II.

Listed below are the six takeaways from this 12 months’s State of the European Union deal with.

1. ‘Sanctions are right here to remain’

Von der Leyen started her speech by praising Ukraine’s resistance in opposition to Russia’s invasion, describing the nation as a “nation of heroes” and vowing the EU’s solidarity will “stay unshakable.”

Ukraine’s first woman, Olena Zelenska, was her visitor of honour and acquired a standing ovation from MEPs.

“In the present day, braveness has a reputation, and that identify is Ukraine,” von der Leyen stated, including she is going to journey to Kyiv later within the day.

The Fee chief additionally unveiled a number of proposals to align Ukraine with the only market, together with by extending the European free-of-charge roaming space, and assist its reconstruction, with €100 million to rebuild broken colleges.

Nonetheless, she didn’t current any plans for brand spanking new weapons supply, as Kyiv continues to demand within the midst of a lighting counteroffensive.

She added that the EU ought to have listened to jap European nations that “have been telling us for years that Putin wouldn’t cease.”

Von der Leyen then spoke about Russia, the state of its financial system and the excessive worth that Vladimir Putin is paying for his “path of loss of life and destruction.”

“The Russian navy is taking chips from dishwashers and fridges to repair their navy {hardware}, as a result of they ran out of semiconductors,” she stated. “Russia’s business is in tatters.”

“It’s the Kremlin that has put Russia’s financial system on the trail to oblivion,” she added.

In what gave the impression to be a direct rebuke to critics who declare the EU’s hard-line in opposition to Russia will ultimately collapse beneath the load of the vitality disaster, von der Leyen sought to dispel any doubts.

“I wish to make it very clear, the sanctions are right here to remain,” she stated. “That is the time for us to indicate resolve, not appeasement.”

2. ‘We now have to decouple’

As anticipated, the vitality disaster featured excessive on von der Leyen’s to-do listing. 

The Fee chief formally introduced three key proposals to curb electrical energy payments: an EU-wide plan to introduce necessary electrical energy financial savings, a uniform worth cap on the surplus revenues made by inframarginal energy vegetation (that’s, those that do not use gasoline, reminiscent of renewables, nuclear, hydropower and lignite), and a windfall tax to partially seize the large income reaped by fossil gas corporations.

The primary measure intends to decrease consumption throughout peak hours (normally 7 am to 10 pm) with a view to deliver down costs, whereas the opposite two are aimed toward elevating “greater than €140 billion” in additional funds for governments to cross onto customers beneath monetary stress.

“In these occasions, income should be shared and channelled to those that want it probably the most,” von der Leyen stated.

Conspicuous by its absence was a extra radical and dangerous concept to introduce a worth cap on all gasoline imports, as demanded final week by a majority of member states. The Fee has warned the cap may push shippers to promote their gasoline some other place and endanger the EU’s safety of provide forward of the winter.

Von der Leyen, nevertheless, did endorse requires a decoupling of costs within the electrical energy markets.

Underneath the present system, referred to as “benefit order,” the ultimate worth of electrical energy is about by the most costly gas wanted to fulfill all energy calls for: on this case, gasoline. As gasoline costs soar, so do electrical energy payments.

“The present electrical energy market design – based mostly on benefit order – isn’t doing justice to customers anymore. They need to reap the advantages of low-cost renewables,” she stated.

“We now have to decouple the dominant affect of gasoline on the value of electrical energy. For this reason we’ll do a deep and complete reform of the electrical energy market.”

However the reform is anticipated to take time to develop and can solely brings solutions in the long run.

3. ‘We should make nature our first ally’

Von der Leyen’s analysis of the vitality disaster has one root trigger: the EU’s heavy dependency on fossil fuels.

The bloc, she stated, ought to now attempt to hurry up the transition away from all imported fuels and develop homegrown and self-reliant programs of inexperienced expertise, like Denmark did when it wager onerous on wind energy within the aftermath of the Nineteen Seventies oil disaster.

“The excellent news is: this obligatory transformation has began,” she stated.

The president talked of hydrogen as a “sport changer” for the continent and stated her government will suggest to create a brand new European Hydrogen Financial institution to safe round €3 billion in investments for the sector.

“We have all seen to what extent the Inexperienced Deal is essential. Summer time 2022 will stay in individuals’s memoires,” she stated. “All of us noticed the dry rivers, the burning forests, the affect of the acute warmth. And beneath the floor, the scenario is much starker.”

Von der Leyen recommended the cross-border solidarity seen in latest pure disasters, with member states sending planes to struggle devastating fires in France and Germany. 

She then vowed to double the EU’s firefighting reserves within the subsequent 12 months and buy “10 mild aircrafts and three helicopters” for the widespread fleet.

At worldwide stage, the president stated she is going to push for a stronger defence of biodiversity on the upcoming UN convention in Montreal, in addition to within the COP27 in Egypt.

“We should work relentlessly to adapt to our local weather – making nature our first ally,” she stated.

4. ‘Guidelines which can be match for the challenges’

Carefully linked to the inexperienced transition, von der Leyen spoke in regards to the EU’s fiscal guidelines, a extremely delicate matter that has sparked tensions between Northern and Southern nations.

The disciplinary guidelines, referred to as the Stability and Progress Pact (SGP), require members states to implement monetary insurance policies that hold their deficit beneath 3% and debt beneath 60% of GDP, limits that many governments at the moment exceed by a appreciable margin.

The SGP stays suspended to deal with the present crises and pending a reform.

“The way forward for our youngsters wants each that we spend money on sustainability and that we make investments sustainably,” von der Leyen stated, noting excessive debt was a “new actuality.”

“We’d like fiscal guidelines that permit for strategic funding, whereas safeguarding fiscal sustainability,” she added. “Guidelines which can be match for the challenges of this decade.”

The present debate centres on how briskly nations must be required to scale back their ranges of public debt and what number of exceptions must be made within the complete calculation. For instance: some nations want to see investments in inexperienced expertise spared from the SGP surveillance.

Whereas von der Leyen didn’t explicitly endorse the proposal, she stated the reformed guidelines ought to supply extra flexibility and possession to spend money on nationwide initiatives but additionally higher accountability and scrutiny.

“There must be easier guidelines that every one can observe to open the area for strategic funding and to provide monetary markets the arrogance they want,” she stated. “Allow us to chart as soon as once more a joint approach ahead.”

The Fee will current its first proposal to reform the principles in October.

5. ‘We should additionally eradicate corruption at residence’

Probably the most compelling segments of von der Leyen’s speech got here in its second half, when the president spoke in regards to the threats confronted by democracies within the twenty first century.

First, she warned in regards to the “overseas autocrats” funding entities contained in the EU to unfold “disinformation” and “poisonous lies,” reminiscent of a Chinese language centre that dismissed the mass internment of Uyghurs as “rumours.”

Von der Leyen promised to fight these threats with a Defence of Democracy package deal, which, she stated, would expose covert overseas affect and produce “shady funding to mild.”

“We is not going to permit any autocracy’s Trojan horses to assault our democracies from inside,” she informed MEPs.

The president vowed so as to add crimes of corruption within the EU’s human rights sanctions regime, a comparatively new instrument that has been used to punish people in Russia, China, Libya and Eritrea.

Von der Leyen then seemed inwards and mirrored on the “vices that corrode” the EU from inside. The bloc has struggled to deal with democratic backsliding in a number of member states, most notably Poland and Hungary. 

“If we wish to be credible once we ask candidate nations to strengthen their democracies, we should additionally eradicate corruption at residence,” she stated.

Though the president didn’t single out any member state particularly, she stated funds beneath the widespread EU price range will proceed to be linked to the respect for judicial independence and the rule of regulation.

The chief has already began the formal process to partially freeze Hungary’s assigned shared of funds, whereas Poland’s COVID-19 restoration plan is dependent upon home reforms.

6. ‘A rethink of our overseas coverage agenda’

In her speech, von der Leyen sounded the alarm in regards to the precarious state of the rules-based worldwide system of peace and safety, which she described as being “the very goal of Russian missiles.”

“This watershed second in international politics requires a rethink of our overseas coverage agenda,” she stated. “That is the time to spend money on the ability of democracies.”

The Fee chief urged the EU to work extra carefully with “like-minded companions” and promote democracy around the globe.

This effort, she stated, ought to start within the bloc’s fast neighbourhood.

“I need the individuals of the Western Balkans, of Ukraine, Moldova and Georgia to know: You might be a part of our household, your future is in our Union, and our Union isn’t full with out you,” she declared.

Von der Leyen threw her assist behind the thought to determine a European Political Group, an initiative advocated for by French President Emmanuel Macron.

The neighborhood’s first assembly will happen subsequent month and collect the 27 EU nations with over 17 counterparts from Europe, together with the UK, Turkey, Norway, Switzerland, Ukraine and the Western Balkans.

Past the Western membership, von der Leyen stated the EU ought to interact with completely different areas, like Africa and Latin America, and enhance its investments in infrastructure, inexperienced tech and digital networks.

“This requires funding on a worldwide scale,” she stated, including that, along with US President Joe Biden, she is going to convene a leaders’ assembly to evaluate widespread initiatives.

On a separate be aware, von der Leyen stated her government would inject new momentum to the long-stalled ratification of EU commerce offers with Chile, Mexico and New Zealand.

In the direction of the top of the speech, the Fee president stated {that a} bigger EU would inevitably require profound inside reform, a course of that will entail altering the EU treaties.

“As we’re severe a few bigger union, we additionally must be severe about reform,” von der Leyen informed MEPs.

“In order this Parliament has referred to as for, I consider the second has arrived for a European Conference.”

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