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SOTEU: Von der Leyen addresses Europe as elections approach

European Commission President Ursula von der Leyen outlined her policy priorities to EU lawmakers in Strasbourg

By: Euractiv - Posted: Thursday, September 14, 2023

Observers believed she would trumpet the successes of her team, from driving the digital and green transition to handling two major challenges for Europe – the war and the COVID pandemic – but remained vague on the big question of whether she plans to run for a second mandate.
Observers believed she would trumpet the successes of her team, from driving the digital and green transition to handling two major challenges for Europe – the war and the COVID pandemic – but remained vague on the big question of whether she plans to run for a second mandate.

by Euractiv Newsroom

European Commission President Ursula von der Leyen outlined her policy priorities to EU lawmakers in Strasbourg on Wednesday (13 September) in her last annual State of the European Union address before next June’s European elections.

Von der Leyen presented a plan that adds the finishing touches to her ‘geopolitical’ Commission’s vision against a backdrop of growing problems – from the shrinking economy and plunging living standards to accelerating climate change and the war in Ukraine.

Observers believed she would trumpet the successes of her team, from driving the digital and green transition to handling two major challenges for Europe – the war and the COVID pandemic – but remained vague on the big question of whether she plans to run for a second mandate.

Please find below the whole liveblog.

(13:00) VDL: We can’t wait for Treaty change to move ahead with enlargement
In her closing remarks, von der Leyen thanked MEPs for their “tireless engagement” in making democracy work, acknowledging the months to come will be delicate in this sense because of the EU elections.
“It is important that in this electoral year, we must continue to be active that is a year of action,” she stressed.
She addressed the many calls from lawmakers for re-opening the EU Treaties. “I will always support those who want to reform the EU and make it work better for citizens. And yes, that means including a European Convention and treaty change event where needed,” she said.
However, this should not be an excuse to prevent EU candidates from joining the bloc. “We cannot wait till we have done this treaty change to move ahead with enlargement,” she concluded.

(12:54) RIP Farm to Fork?
Von der Leyen may maintain that the Commission has delivered 90% of the political guidelines, but a number of agricultural files are notably missing in action, and in her speech.
Most prominent is the fact that von der Leyen neglected to mention the EU’s flagship sustainable food systems law, whose fate currently hangs in the balance [LINK BELOW]. Likewise, the EU’s revision of the animal welfare legislation [LINK BELOW] was conspicuously missing from von der Leyen’s interventions, although the issue was raised multiple times by MEPs.
In the lead up to the speech, multiple sources told EURACTIV that no mention of these initiatives, which make up the backbone of the EU’s flagship food policy, the Farm to Fork strategy, would suggest they’re likely dead in the water.

(11:40) EU unions lash out against fiscal rules, austerity
ETUC, the European Trade Union Confederation, welcomed von der Leyen’s call for a social partners’ summit but made clear they were unhappy with many other things.
“There were no solutions for workers struggling today with the cost-of-living crisis or fearful of losing their jobs,” ETU, said in a statement.
“The elephant in the room was the EU’s current proposals to reintroduce fiscal rules. A lot is at stake: a return to austerity will force member states to make 45 billion of cuts, leading to fewer jobs, lower pay, underfunded services and less investment in the green and digital transitions.”

(11:20) Far-right group wants von der Leyen to rescind the Green Deal
Von der Leyen’s address attracted mild criticism by Marco Zanni from far-right Identity and Democracy (ID), a political group with a traditionally hard eurosceptic stance.
“We have a historic opportunity today to be more pragmatic and less utopian,” he said, referring to the departure of Frans Timmermans from the Commission, which, for Zanni, represents a chance to get the transition back on the right track.
According to him, the problem in the EU is not about farmers or businesses. “The problem is who will be the winner of the transition.”
Zanni also criticised the announced inquiry on the EU bureaucracy impact and the investigation into China’s dumping as leading to more red tape.
His reaction was, however, quite moderated compared to the standards of his group. This could be interpreted as a gesture of goodwill ahead of the EU elections, meaning that the door for a coalition including centre-right, conservative, and far-right in the next mandate is still open – maybe if von der Leyen decides to abjure her Green Deal?

(10:58) ECR’s harsh words for VDL
The first fierce invective of the day was launched by ECR’s Ryszard Legutko, who said “something is rotten in the Union” and went on to enumerate what he said were the many failures of this Commission.
Legutko slammed VDL for the high inflation and the bloc facing recession, as well as the “financial extravaganza” that the common debt by EU created.
He also accused the Commission of bearing responsibility for the energy crisis, as von der Leyen did not adress Europe’s dependency on Russian gas until the war started.
Lastly, he accused von der Leyen of trying to interfere in the Italian elections, comparing her with the Belarus strognman Alexander Lukashenko. Before the elections, von der Leyen said “if things go in a difficult direction, we have tools”.

(10:48) Failed migration policy
Migration policy a “failure,” the co-president of European Conservatives and Reformists group (ECR) Ryszard Legutko said as a reply to von der Leyen. He referred to the situation at the borders as well as an increase in the size and reach of smuggling networks.

(10:42) Cynicism on migration
Philippe Lamberts, co-president of the Greens/EFA, does not share von der Leyen’s optimism about the pact of migration and asylum and the EU approach of doing agreements with “autocrats” in third countries. He thinks the far right “instrumentalises” the discourse on migration, making it a more and more delicate topic for electoral campaigns.

(10:40) Renew “angry” at ‘Orbanisation’ of Europe
Renew chief Stephane Sejourne finishes his statement by raising concerns about the state of democracy in Europe and the “feet dragging” of some member states when it comes to protecting it, as well as the “unanimity poison” that often blocks decisions in the EU Council.
“Europe is not yet responding to the desperate appeals of Polish judges, Hungarian judges, the independent press and civil society. I remain stunned when Italian prosecutors change the civil status of children and therefore withdraw rights from mothers because they are lesbians”.
“No European decision should be hostage to an autocrat in Budapest or elsewhere. Realise, the extent of our support for Ukraine depends on Viktor Orban,” Sejourne stressed.
“Madam President, we refuse the shift of Europe. We refuse the Orbanisation of our continent.”

(10:34) Green Deal? Yes, but…
EPP leader Manfred Weber reiterates the party’s claim of being the “farmers’ party.”
“Producing more food, not less, is our answer to cut inflation on food prices,” he says – a nod to Green Deal files like the Nature Restoration Law or the Commission’s proposal for cutting pesticide use (SUR), which the EPP has slammed as endangering food security.
“We believe in the basic idea of the Green Deal,” Weber stresses, “but we also listen to our workers, SMEs, farmers, youth.”
Green Deal and farmers on opposite sides – a clear departure from von der Leyen’s insistence that both go hand in hand.

(10:33) More prominent role for EU agencies Europol, Eurojust and Frontex
Von der Leyen calls for a “more prominent role” for the law enforcement cooperation agency Europol, criminal justice cooperation agency Eurojust and the EU border agency Frontex.We need to work with our partners to tackle this global plague of human trafficking,” she said, proposing the organisation of an “International Conference on fighting people smuggling”.

(10:28) EPP’s Weber endorses EU-Tunisia pact
EPP President Manfred Weber endorses EU-Tunisia memorandum of understanding. The president of the largest group in the European Parliament welcomed the agreements von der Leyen, together with Italian PM Giorgia Meloni and Dutch PM Mark Rutte, signed with the Tunisian Presient Kais Saied. The agreement foresees unconditional EU financial aid to Tunisia to manage its borders, together with funds for projects to reinforce ties between the EU and Tunisia, through Italy.

Time for an update
“Our legislation is over twenty years old and needs an urgent update,” von der Leyen said regarding EU efforts in fighting human smuggling.
According to the EU Commission president, human trafficking activities continue evolving. “They attract desperate people with their lies. And put them on deadly routes across the desert, or on boats that are unfit for the sea,” von der Leyen said about the way human smugglers operate.

(10:27) Chinese EVs benefitting from the Green Deal.
“We want a European Green Deal not a Chinese one! We don’t want to see Chinese electric vehicles benefiting from our ambitious climate approach,” says EPP head Manfred Weber, seemingly backing the Commission’s decision to take on Chinese EV imports.

(10:24) European carmaker stocks rise in reaction to VDL announcement
Renault is up 3.5%, VW is up 2.7%, BMW is up 2%, Mercedes up 1% at the time of writing, seemingly reacting to the Commission president’s announcement to investigate Chinese subsidies in the electric vehicles sector. It looks like investors like the idea of stronger EU trade defence.

(10:21) A Defence Union on the way
“We have started to build the European Defence Union at 27. And I believe we can finish it at 30+,” the President says when reaching the end of her speech.
Her move proves she has an interest in including Defence in the Union policies for the longer term. In the past year, the Defence Union has been built on temporary frameworks, and funds made of a few million with no clear perspective. But today may not be the day for more specifics.

(10:20) European vs. Chinese cars
The big transport news is undoubtedly the announcement of the Commission’s anti-subsidy investigation into Chinese electric vehicles.
While the announcement was met with applause in Strasbourg, it’s unclear what this means for consumers. Without cheaper Chinese cars, what is on offer for cash-strapped drivers looking to buy an EV?
In recent years, largely in response to Chinese imports, EU manufacturers have shifted towards larger luxury vehicles, such as SUVs, to capture market share.
Just days ago, Olaf Scholz, the chancellor of the EU’s car manufacturing leader, Germany, explicitly welcomed Chinese competition. At the IAA car show in Munich, Scholz said of Chinese car imports: “Fair competition stimulates business. It is in the interest of consumers”.
Obviously, the keyword is “fair”. In launching the anti-subsidy investigation, the Commission feels China has fallen on the wrong side of fair competition. But one hopes it won’t be the average car buyer who bears the fallout.
Elsewhere in the President’s remarks, clean shipping got a nod, with a new 100% methanol-powered ship held up as an example of green tech. However, there is no mention of aviation despite MEPs voting on the EU green jet fuel law later today. Rail was also absent from Von der Leyen’s remarks (the 2021 “EU Year of Rail” feels long ago).

(10:19) Treaty change when needed
Von der Leyen endorses the change of the EU treaties, similar to what she announced during last year’s speech. More specifically, in 2022 she endorsed the citizen-driven results and final recommendations of the Conference on the Future of Europe (the first cross-border democratic experiment by EU institutions). While the EU Commission officially pushes for the opening of the treaties, member states are more hesitant or directly against. Despite the EU Parliament being the institution pushing more for treaty changes, the institutional procedure to reform has remained blocked for over a decade.

(10:18) Slip of the tongue?
Von der Leyen accidentally addresses Parliament lawmakers as the honourable member ‘states’, in a slip of the tongue that was easily the most entertaining part of the speech so far.
But is it a slip of the tongue? If it was deliberate, perhaps it was actually a covert message in a bid for a second term as Commission president… or otherwise, a bid to launch a career as a stand up comedian.

(10:16) Quick mention of the EU budget woes
Von der Leyen only quickly mentioned the need to examine how the EU budget is financed.
A revision of the Multiannual Financial Framework (MFF) – the EU long-term budget – was put forward in June to boost EU coffers, which have been drained by high inflation and the rise of borrowing costs.
“We need to discuss the future of our budget – in terms of what it finances, how it finances it, and how it is financed,” von der Leyen said.
The revision is currently being discussed by member states, who were called to increase their national contributions and green-light new revenue sources for the EU budget. However, member states are reluctant to pay more to the EU, and it is yet to be determined when an agreement will be reached.

(10:15) No details on future accessions
Von der Leyen runs the European Commission’s usual enlargement talking points home by stressing that “accession is merit-based” and her house will “always defend the principle”.
“We have seen the great strides Ukraine has already made since we granted them candidate status. And we have seen the determination of other candidate countries to reform,” she says.
But after the debate of the past month, those who have been looking for her going into finer details on enlargement will be disappointed.
She also falls short of going into detail about what to expect only a few weeks from now in the European Commission’s highly anticipated enlargement reports. It is somewhat of a missed opportunity to put the minds of EU hopefuls at ease.

EU36 possible
Von der Leyen makes a case for EU reform and contradicts those who say an EU at 36 would be feasible, saying the “next enlargement must also be a catalyst for progress”.
“We have started to build a Health Union at 27. And I believe we can finish it at 30+. We have started to build the European Defence Union at 27. And I believe we can finish it at 30+,” Von der Leyen says.
“We have proven that we can be a Geopolitical Union and showed we can move fast when we are united,” she adds about Europe’s response to Russia’s war in Ukraine.
However, let’s not forget that one of the main battles in an enlarged EU would be unanimity in foreign and security policy, which admittedly slows decisions even with EU27. Hungary, looking at you here.

(10:14) No means no
“No means no,” von der Leyen said, calling for this “basic principle” to be cast into law when talking about the directive to combat violence against women.
The directive is in the trilogue phase, where Parliament is calling for crime of rape to be included in the directive, in line with the Commission’s proposal.
“I know this house supports our proposal,” she told the plenary in Strasbourg.
In the meantime, the Council scrapped from the Commission’s proposal Article 5 that calls non-consensual sex act a criminal offence.
Reacting to the speech, Parliament co-rapporteurs Frances Fitzgerald (EPP, IE) and Evin Incur (S&D, SE) said: “Non-consensual sex, i.e. rape, must be included in any Directive on Violence Against Women. The essential element of that offence is consent, as highlighted by the president”.

(10:12) Migration pact closer than ever
“An agreement on the pact has never been so close,” von der Leyen said regarding the pact for migration an asylum, the overall EU proposal that for the first time in history, if approved, will give the 27 member states the same rules on reception, welcoming system, crisis management, and different procedures to manage the borders and the people looking for international protection.

Let’s bring Bulgaria and Romania in the Schengen area” Von der Leyen said. The two member states have tried multiple times to be part of Schengen however opposition continues from Austria who continues to put a veto on accession.

(10:11) Rule of law reports for accession countries
Rule of law reports, which look into the state of democracy in EU member states, will be extended to accession countries, the Commission president said.
“I am very happy to announce that we will open the Rule of Law Reports to those accession countries who get up to speed even faster,” von der Leyen said, adding that this will help them in their reform efforts.

(10:10) Extreme confidence in ammunition production support fund
“Through our ASAP proposal, we are ramping up ammunition production to help match Ukraine’s immediate needs.”
The President looks confident that the new scheme will help the bloc’s industries ramp up production capacity in ammunition and missiles.
However, it will be very difficult to match Ukraine’s “immediate” needs with the Act in Support of Ammunition Production (ASAP).

The end of the EU defence industrial policy
The President doesn’t mention any other scheme to support defence procurement or production, and her “way ahead” after ASAP is all about enlargement and support in reform-making. There was no mention of what is happening with ASAP’s regulatory pillar that the Commission proposed.
There is also no mention of the European Defence Production Act or the long-awaited European Defence Investment Programme (EDIP), which was initially billed to propose a VAT exemption but was postponed to a later date.
Also missing was a congratulations or welcome of the EDIRPA fund (European Defence Industry through the Joint Procurement Act) programme that was voted yesterday by the European Parliament.
Defence as a pillar of the EU’s industrial policy will have to wait.

(10:09) ‘Completing’ the Union
Onto enlargement, then. One of the more anticipated issues EU diplomats expected her to raise after European Council President Charles Michel came out strongly, and somewhat surprisingly, in favour of a 2030 accession.“In a world where some are trying to pick off countries one by one, we cannot afford to leave our fellow Europeans behind,” Von der Leyen says.“In a world where size and weight matters, it is clearly in Europe’s strategic and security interests to complete our Union,” she adds.Complete is the keyword here – but von der Leyen gives no indication whether this would indeed mean Michel’s touted target date, which in any case would be for the next European Commission to deal with.

(10:08) Temporary protection extended
Von der Leyen announces the European Commission “will propose to extend our temporary protection to Ukrainians in the EU”, whose number currently stands at about four million.
The EU for the first time activated the bloc’s Temporary Protection Directive (TPD), a 20-year-old law designed to help shelter refugees, less than a week after the war started.
The measure allowed Ukrainians to move freely across the EU, giving them instant rights to live and work within the bloc, and also offering them access to social service benefits like housing and medical care. It meant they were given temporary residency status without having to go through complex asylum procedures.
Earlier this year, the EU’s Home Affairs Commissioner Ylva Johannson was quite vocal in saying failure to use the EU’s Temporary Protection Directive in 2015 was the ‘wrong decision’.

(10:07) Standing ovation
Standing ovation across the board, as von der Leyen says those words everyone knows by now: “Aguanta, Ucrania. Slava Ukraini!” Some members of the far-right Identity and Democracy also stood up.

(10:06) Tackling insecurity in Africa
Insecurity in Africa can become “fertile ground for the rise of terrorism”, von der Leyen said. The combination of recent military coups and poverty, like in the Sahel, one of the “poorest”, can lead to deep insecurity that can directly impact Europe.
Von der Leyen announces works with EU’s chief diplomat Josep Borrell towards a new strategic approach to the continent to be pushed forward at the next EU-African Union Summit.
“We need to focus on cooperation with legitimate governments and regional organisations,” von der Leyen said, referring to the African continent, where, in recent years, more wars, crises, climate events and military coups made more and more unstable.
“We need to develop a mutually beneficial partnership which focuses on common issues for Europe and Africa,” the EU Commission president said, a strategic approach that will lead the next EU-AU Summit.

(10:04) Balanced management of migration
Migration “needs to be managed” balancing protection of borders and protection of people. Von der Leyen said that a balance is needed when legislating on migration, working with key partners, finding a compromise “between sovereignty and solidarity, between security and humanity,” she said.
This balance is the “spirit of the new pact on migration and asylum,” she pointed out, referring to the package of legislative files that the EU institutions aim to approve before the end of the legislative mandate in June 2024.

(10:02) Tunisia migrant deal a model for other states.
Von der Leyen says that there was little prospect of brokering an agreement on migration at the start of her mandate. She has sought “practical solutions” on migration and urged lawmakers to get the migration package of legislation finalised in the coming months. Mentions partnership with Tunisia that will bring “mutual benefits” adding that “we want to work on similar agreements with other countries”.

(10:01) Ukrainian stories with a message
Von der Leyen starts her Ukraine segment relatively late into the speech, something listeners won’t fail to notice. She recalled the stories of Ukrainian refugees – a mother, a young writer and her friends.Victoria Amelina, a Ukrainian novelist who became a war crimes investigator following the Russian invasion, fought to uncover the true stories of her compatriots’ experiences under occupation.Hector Abad Faciolince, a fellow writer from Colombia who is in the audience and part of a campaign “Aguanta, Ucrania” – “Resist, Ukraine”, created to tell Latin Americans of Russia’s war of aggression, a veiled message maybe to those countries that have remained on the fence when it comes to condemning Moscow.
“I want you to know that we will keep the memory of Victoria – and all other victims – alive,” she says.

(09:56) From a Super Mario to another
Von der Leyen announced that former Italian prime minister and former head of the European Central Bank Mario Draghi will be tasked with preparing “a report on the future of European competitiveness.”
“Because Europe will do ‘whatever it takes’ [a reference to Draghi’s most famous line that allegedly ‘saved’ the euro in 2012] to keep its competitive edge,” she continued.
Last week, Draghi published a column in The Economist on the path to fiscal union in the eurozone in which he stressed that the EU’s fiscal integration needs “new rules and more pooled sovereignty.”
Previously, former Commission chief Jean-Claude Juncker assigned a similar job to another Super Mario, former Italy’s prime minister Mario Monti, who chaired a high-level group of experts on the EU’s own resources. In the end, the ‘Monti group’ put forward a final report that served as the basis for the Commission’s legislative proposals for the EU’s long-term budget for 2021-2027.

(09:55) Missed opportunity on Global Gateway
Von der Leyen mentions the Global Gateway, the EU’s alternative to China’s Belt and Road Initiative (BRI) launched in 2021.
“Global Gateway is more transparent, more sustainable, and more economically attractive”, von der Leyen says. But she doesn’t mention whether the EU will work closer with the other countries to identify the most crucial projects and needs, as Brazil has asked for in an interview with Euractiv, saying it’s supported by other states too.
The Global Gateway will work with the newly announced India-Middle East-Europe Economic Corridor, von der Leyen says. “It will make trade between India and Europe 40% faster.” One senior Commission official said ahead of her speech that “this is a key initiative, taking the Global Gateway to the next level with strategic projects moving forward”. www.euractiv.com
Brazil envoy: EU-Latin America summit not about Ukraine but regional partnership
The EU-Latin America summit this week shall not be overshadowed by the Europeans’ preoccupations surrounding the war in Ukraine, Brazil’s EU ambassador Pedro Miguel da Costa e Silva told EURACTIV.

(09:53) Cautious trade ambitions
“We should aim to complete deals with Australia, Mexico and Mercosur by the end of this year and soon thereafter with India and Indonesia,” von der Leyen said. It seems that the ambition to get to a deal with India by the end of this year has been given up. Also, the formulation “we should aim to complete” shows that she is unsure whether the trade deals will come through before the end of the year. In 2024, with upcoming European elections and a much more trade-sceptic Belgian EU Council Presidency, trade deals are unlikely to progress.

(09:52) Sparing Ukraine for last
Nearly half an hour into her speech, Von der Leyen has stuck to pleasing domestic European audiences with topics like economy, employment and industry. Her strong topic – Ukraine – is so far not addressed.

(09:52) Taking the next STEP
Von der Leyen praised the Commission’s newly-unveiled ‘STEP’ platform that will look to “boost, leverage and steer EU funds to invest in everything from microelectronics to quantum computing and AI”.
The STEP, once expected to be a full-fledged EU sovereignty fund with potentially fresh cash, turned out to be no more than a rehashing of existing funds, plus an €10 bln top-up from member states. It was met with great disappointment from… all parties involved, who consider its financial firepower to be too small compared to Chinese and US counterparts.

(09:51) Investment in everything but defence?
Von der Leyen wants more competition, investment, research, development, innovation… But nowhere does she mention defence-related technologies. Surprising, since there’s a war raging at the EU’s borders and the member states are all investing massively in their military.
Nor does she mention the special case of defence industries across Europe, which are under strain from the growing demand, and mixed signals they are getting from the member states, the European Commission, NATO…

(09:50) Bored yet?
Commissioner Ylva Johansson spotted knitting in her seat. Maybe she is waiting for Von der Leyen to start talk ing about her portfolio, Home Affairs, before she starts paying attention.

(09:48) Artificial Intelligence
Von der Leyen mentioned the AI Act, the first of its kind in the world. The Act is moving into its final stages, with the next political trilogues taking place on 3 and 26 October. The Spanish presidency hopes to reach a deal during these trilogues before next year’s election.

(09:47) Disinformation, harmful content, and data privacy
With “disinformation, spread of harmful content, risks to the privacy of our data,” Von der Leyen may be referring to draft laws such as the legislation to detect and prevent child sexual abuse material online or news about election manipulation, that are part of the overarching EU law on illegal online content. She may also be referring to the European Media Freedom Act, a piece of legislation that prohibits the deployment of surveillance technologies against media service providers. Activists and journalists have already voiced doubts if the next vote on this legislation, scheduled for 3 October, could really rein in member states’ surveillance powers to target journalists.

(09:45) DMA and DSA
Von der Leyen referenced the Digital Markets Act (DMA) and the Digital Services Act (DSA). For the DMA, the list of online services designated as “gatekeepers” was revealed on 6 September, which will have six months to adapt to strict antitrust practices or face up to 20% global annual turnover fines. Regarding the DSA, since 25 August, the legislation has been enforced for very-large online platforms and very large search engines and will be enforced for every platform by 24 February 2024. Until then, for the platforms it does not apply to, the national authorities are still the regulators, while for very large online platforms and very large search engines, it is the European Commission.

(09:43) Energy crisis officially over. According to von der Leyen, Europe has emerged stronger from the energy crisis because of investments in renewables and joint gas buying. As a result, “the price for gas in Europe was over 300 euros per MWh one year ago. It is now around 35.” This now needs to replicate this model for Critical Raw Materials and hydrogen, she said.

(09:42) Tackling inflation
Von der Leyen’s singled out persistently high inflation as one of the EU’s major economic challenges, blaming Vladimir Putin’s “deliberate use of gas as a weapon” to push energy prices up. “The good news is that Europe has started to bring energy prices down,” the EU Commission president said, as Europe divested from Russian oil and gas.
EU inflation stood at 6.1% year-on-year in late July, compared to last November’s 11.5%.

(09:41) EU still struggling on labour and skills shortages
“Labour and skills shortages are reaching record levels,” von der Leyen said, pointing to how hospitals, restaurants and businesses are struggling to find employees.
“Europe is close to full employment. Instead of millions of people looking for jobs, millions of jobs are looking for people,” she said.
The Commission president said the EU needs to work to improve access to the labour market, particularly for young people and women, and boost qualified migration. A proposal to facilitate the recognition of qualifications of third country nationals was expected for 2023, but was not mentioned by the President during her speech.
Euractiv covered all aspects of Europe’s quest for skills in this special report.

(09:40) Legislative proposal to reduce reporting obligations by 25% in October
“Small companies do not have the capacity to cope with complex administration,” the Commission president said, adding that her long-promised legislative action to reduce reporting obligations at the European level by 25% would be forthcoming in October. Only yesterday, the EU Commission announced an “SME Relief Package”, proposing changes to tax law and late payments.

(09:39) VDL to appoint “SME envoy”
SMEs are the darlings of EU speeches, and it is no different today. Not only did Von der Leyen reiterate her ambition to lower reporting requirements, but she also announced that she would appoint an “SME envoy” to report directly to her.
“We want to hear directly from small and medium businesses about their everyday challenges,” she said. The “SME envoy” sounds like the “Stoiber Group” from 2007 to 2014. Headed by the Bavarian conservative politician Edmund Stoiber, the group’s goal was to reduce companies’ administrative burdens. And, like today, it was mostly targeted towards a conservative German audience.

(09:38) A message to Manfred
Giving her speech in English, German, and French is a tradition for Von der Leyen, but switching languages is also a political instrument.
It is certainly no coincidence that the German Commission president switched to her native language to address EPP chief Manfred Weber, a fellow German and her main political rival who has declared the EPP the “farmers party” and used this slogan to oppose elements of Von der Leyen’s Green Deal.
“I am and remain convinced that agriculture and protection of the natural world can go hand in hand,” von der Leyen counters.

(09:34) A little more conversation, a little less action please
After uproar in the farming sector that they were overlooked in last year’s speech, von der Leyen made a point of thanking the EU’s farmers, expressing her appreciation to them for “providing us with food day after day”.
And while she stressed the need to protect Europe’s nature, she said this must be balanced with food security, which remains an “essential task”. “For us in Europe, this task of agriculture – producing healthy food – is the foundation of our agricultural policy,” she said, as well as “self-sufficiency”.
However, she noted the challenges that farmers have been up against, listing Russia’s invasion of Ukraine and climate change alongside “new obligations” as having a “growing impact on farmers’ work and incomes”. The words will come as music to the ears to her political family, the EPP, who have waged a war against the EU’s Green Deal in the name of food security, courting the EU’s rural vote.
To move towards a more sustainable agriculture, von der Leyen stressed the need for “more dialogue and less polarisation”. To do so, she wants to launch a “strategic dialogue” on the future of agriculture in the EU.
“I am and remain convinced that agriculture and protection of the natural world can go hand in hand. We need both,” she said.

(09:33) 90% of Von der Leyen’s 2019 priorities already delivered. Are they?
“Thanks to this Parliament, to the member states and to my team of Commissioners, we have delivered over 90% of the Political Guidelines I presented in 2019,” stressed von der Leyen before MEPs.
However, according to an assessment made by the European Parliament Research Service published in March, only two-thirds (63%) of the 597 initiatives announced have been submitted and, in the case of the legislative proposals, the co-legislators have started work.
Of the 379 initiatives submitted, the paper continues, half (50%) have already been adopted (188) – by the legislators in the case of the legislative proposals, or simply by the Commission in the case of the non-legislative initiatives – while the vast majority of the other half are either proceeding normally through the legislative process (129, or 67%) or are close to adoption (28, or 15%).

(09:27) “EU-China summit, but when?
“De-risk, not decouple – this will be my approach with the Chinese leadership at the EU-China Summit later this year,” Von der Leyen said. However, summit dates remain up in the air as the EU’s chief diplomat, Josep Borrell is expected to make his long-delayed trip to Beijing first.

(09:27) Anti-subsidy investigation into electric vehicles coming from China
Von der Leyen announced that the EU would open an anti-subsidy investigation into electric vehicles coming from China. “Global markets are now flooded with cheaper Chinese electric cars and their price is kept artificially low by huge state subsdies,” she said, arguing that this was distorting the European markets. As the graph below shows, EU imports of Chinese electric vehicles have skyrocketed over the past months.

The EU will thus use its new Foreign Subsidies Regulation to investigate the Chinese subsidies for electric vehicles. Depending on the result of the investigation, the EU can then impose redressive measures on electric vehicles coming from China.

(09:26) Solar gets a nod.
“We have not forgotten how China’s unfair trade practices affected our solar industry, ” Von der Leyen said, adding many businesses were pushed out by Chinese competitors backed by “huge state subsidies.” However, no specific measures for solar were announced.

(09:25) European Green Deal, phase 2.
“We need to finish this work,” with an approach “for each industrial ecosystem,” she said, adding work will start this month with “a series of Clean Transition Dialogues with industry”. This will include a wind industry package, with focus on skills, access to finance and supply chains. The ambition, she said, is “crystal clear: the future of our clean tech industry has to be made in Europe.”

(09:24) Electric vehicles collide with reality?
As expected, Von der Leyen touts electric vehicles as a sign of Europe’s economic ingenuity, symbolising the shift to a clean economy. In reality, Europe has struggled with the electric mobility transition. Competition from the United States, particularly China, has caused serious issues for the once dominant EU car manufacturers. Europe is experiencing growing EV imports and fewer exports. In addition, charging infrastructure varies significantly between member states.

(09:23) Erratic weather this summer ‘reality of a boiling planet’
The devastating floods and fires experienced across Europe this summer are the “reality of a boiling planet”, said von der Leyen, adding that people will be thinking about this as they go to the polls next year.
“This summer – the hottest ever on record in Europe – was a stark reminder of that. Greece and Spain were struck by ravaging wildfires – and were hit again only a few weeks later by devastating floods. And we saw the chaos and carnage of extreme weather – from Slovenia to Bulgaria and right across our Union,” she told the European Parliament.

(09:23) Green Deal is a necessity
European Green Deal was born out of a “necessity to protect our planet,” she said, referring to wildfires that ravaged southern Europe this summer. “But it was also designed as an opportunity to preserve our future prosperity,” she says, concerning clean hydrogen investments in Europe, which are higher than the US and China combined.

(09:20) Methanol-powered ship
Von der Leyen makes a reference to a methanol-powered ship, noting that she will travel to Denmark to attend the launch. The Commission’s “Fit for 55” package took aim at shipping emissions – no easy feat given the international nature of the business (not to mention the potential for green taxes to push up the cost of goods). As well as adding shipping to the EU carbon market, the Commission has mandated ships to use progressively cleaner fuels. This 100% methanol-powered ship is an expensive outlier of course, but provides a glimpse of where the sector can go.

(09:19) Not quite a full house
Ursula von der Leyen starts her speech despite many empty seats. The far-right and far-left sides of the hemicycle look rather empty and it appears some Greens are running late as well.

(09:17) Green Deal emerges early on
First reference to European Green Deal early on in von der Leyen’s speech, positioned as an achievement: EGD is “the centrepiece of our economy and unmatched in ambition”.

(09:15) Metsola outlines achievements, challenges
Over the last years, we have overcome finanical crisis, pandemic, Brexit, we stood firm against Russia’s illegal and brutal agression against Ukraine, we are addressing the climate emergency and have engaged from toxic Russian energy and we have set the foundation for years to come.
The world is changing and Europe must adapt too. We have come a long way but too many people across the union are still struggling. We need to keep our people’s concerns at the centre of all our actions.

(09:08) SOTEU starts with Metsola speech
The State of the Union session opens with a speech from European Parliament President Roberta Metsola.

(09:07) Welcome to Euractiv’s liveblog covering Ursula von der Leyen annual address in Strasbourg, where she’ll be outlining the policy priorities for her next (last?) 12 months as European Commission chief. Stay tuned for all the updates and comments from EURACTIV policy experts.

*first published in: Euractiv.com


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