Europe depends on two global powers it increasingly struggles to trust, but the threats they pose are fundamentally different. An ISDP policy brief by Niklas Swanström warns that Brussels risks wasting resources by treating economic dependence on the United States and China as the same problem.

Europe is facing an unprecedented surge in economic pressure from its biggest trading partners, but its main weapon against coercion remains unused. An ISPI DataLab investigation finds that attempts to force the EU into political concessions through trade restrictions, tariffs and supply-chain controls have increased eightfold since 2018.

The EU was built to manage markets, not defend a continent. Now Russia’s war against Ukraine, American unpredictability and growing pressure from China are forcing Brussels into security decisions its institutions were never designed to handle.

France is running out of room to escape its public-finance crisis. With the deficit reaching 5.4% of GDP and public debt approaching 120%, rising borrowing costs are turning years of fiscal complacency into an increasingly dangerous liability.

Europe is preparing a massive military spending drive, but more money does not automatically mean a stronger European defence industry. An IRIS assessment warns that the EU’s ReArm Europe plan could accelerate weapons purchases and expand production without solving the fragmentation that has weakened European military manufacturing for decades.

The EU wants its next long-term budget to do more than finance programmes – it also wants to defend democracy and the rule of law. But the Centre for European Reform raises a difficult question: can Brussels use financial pressure to confront governments that undermine democratic institutions without hurting the citizens it claims to protect?

Europe is running out of workers – and its next enlargement could provide part of the answer. CEPS warns that shrinking working-age populations and rapid ageing are putting growing pressure on European businesses, public services and economic growth.