NEW DELHI — The European Union and India locked arms against U.S. President Donald Trump’s tariff offensive and China’s flood of cheaper goods to conclude talks on a landmark trade pact on Tuesday.  Under the deal, India will lower tariffs on European cars and wine, while the EU signaled it would assist Indian companies with decarbonization and negotiate duty-free quotas for Indian steel.  “Two giants who choose partnership, in a true win-win fashion. A strong message that cooperation is the best answer to global challenges,” said European Commission President Ursula von der Leyen, standing next to Indian Prime Minister Narendra Modi. The announcement rounded off a year of intensive negotiations in which the EU sought to lock down a trade deal with the world’s most populous nation. Von der Leyen and European Council President António Costa were guests of honor at India’s exuberant Republic Day celebrations on Monday. Ties between India and the U.S. reached a low point last August, when Trump imposed a 50 percent tariff on goods from the South Asian nation over its purchases of Russian oil.  “Both know that they need each other like never before and in this fractured world where trusted partnerships are very, very hard to come by,” said Garima Mohan, who leads the German Marshall Fund’s work on India. Under the deal, India will gradually slash tariffs on European cars, reducing tariffs from 110 to 10 percent on 250,000 cars every year.  A range of agricultural goods will also see their tariffs drop, coming as a reassurance for the European Parliament and the EU’s farmers who have been heavily protesting in recent months over fears that they would be undercut by cheap farm produce.  Tariffs on wine will be reduced from to 20 and 30 percent from 150 percent now, depending on value. European olive oil will also enter duty free into India, instead of facing a 45 percent tariff. STEEL DEAL The stickiest issues related to steel and the EU’s carbon border tax: New Delhi, a major steel exporter, wanted to make sure that its metals wouldn’t be impacted by an upcoming 50 percent EU tariff on steel, and the carbon levy that has just entered force. In response to those concerns, the EU plans to give India a significant share of the 18.3 million metric tons of steel allowed to enter the bloc duty free — Brussels will negotiate this with its partners as is required by global trade rules.  “There will of course be a difference in how you treat this negotiation on application of steel measures between FTA and non-FTA partners. Therefore I think it was strategic from both sides that we have the agreement now and that India will be treated as an FTA partner,” EU trade chief Maroš Šefčovič told POLITICO.  On the carbon border tax, a new levy on carbon emissions that has irked countries such as the United States and Brazil, Brussels will “help Indian operators to have a smooth introduction of CBAM with all the technical assistance and all the additional advice we can provide,” Šefčovič added, stressing that the Commission would treat all its partners equally.  For India, the deal represents an opportunity to boost its exports of pharmaceuticals, textiles and chemicals.  This story has been updated.

NEW DELHI — The EU and India have concluded trade talks on a free trade agreement, a senior Indian official told POLITICO.  “Official-level negotiations are being concluded and both sides are all set to announce the successful conclusion of FTA talks on 27th January,” Commerce Secretary Rajesh Agrawal told POLITICO.  Under the deal, India is expected to significantly reduce tariffs on cars and machinery as well agricultural goods such as wine and hard alcohol. “This would be a very good story for our agriculture sector. I believe we are aiming to start a completely new chapter in the field of cooperation in the automotive sector, in machinery,” EU trade chief Maroš Šefčovič told POLITICO. On trade in services, the trade chief said that sectors like telecoms, maritime and financial services were expected to benefit. “This is again something where also India is making groundbreaking steps to new levels of cooperation, because we are the first one with whom they’re ready to consider this cooperation,” he said.  The conclusion to the talks arrived as the EU leadership was on a three-day visit to India for a summit to boost trade and defense ties between New Delhi and Brussels.  With the talks between the two sides having been on and off since 2007, the pact comes at an ideal moment as New Delhi and Brussels battle steep tariffs from the U.S. and cheap goods from China. 

STRASBOURG — Donald Trump’s threats to slap tariffs on European countries that disagree with him on Greenland are “simply wrong,” European Commission President Ursula von der Leyen said Wednesday morning. Speaking to MEPs in Strasbourg, von der Leyen said the EU is aligned and “working together” with the U.S on the need to ensure security in the Arctic, and Brussels is planning “a massive European investment surge in Greenland” to support the local economy and boost its infrastructure.  “This is why the proposed additional tariffs are simply wrong,” von der Leyen said. She added that the EU wants to stop the crisis escalating as “a dangerous downward spiral between allies” would only “embolden the very adversaries we are both so committed to keeping out of our strategic landscape.” Von der Leyen’s comments come as EU leaders scramble to deal with Trump’s threats to annex Greenland and react to his announcement of 10 percent tariffs on goods from countries that sent troops to Nuuk.  “Europe prefers dialogue and solutions, but we are fully prepared to act, if necessary, with unity, urgency and determination,” she said.  The Commission president also said the EU needs to diversify its trade relationships and “reduce our dependencies.” The EU is negotiating trade deals with India and other countries that “will open massive opportunities for our businesses.” ”Our supply chains and derisking goals depend on it,” she added, hinting at the bloc’s highly interlinked trade connections with the U.S. The European Union is on track to get nearly half of its gas from the United States by the end of the decade, creating a major strategic vulnerability for the bloc as relations with Washington hit an all-time low, as POLITICO reported earlier this week.  Just a few hours before lawmakers vote on whether to send the Mercosur trade deal for legal review, which could stall the adoption process by up to two years, von der Leyen said the deal with the South American bloc will be beneficial for the dairy, wine, spirits and oil sectors, while the Commission has secured “strong” safeguards for other sensitive agri-food sectors.   “This is a deal that will bring benefits across our economy, across every member state. And it can shield Europe from the risks it faces, ensuring our prosperity and our security at the same time,” she said. 

BRUSSELS — EU leaders have toughened their position and want the European Commission to ready its most powerful trade weapon against the U.S. if Donald Trump doesn’t walk back his Greenland threats. Germany has joined France in saying it will ask the Commission to explore unleashing the Anti-Coercion Instrument at the emergency EU leaders’ summit in Brussels on Thursday evening, according to five diplomats with knowledge of the situation. Berlin’s move brings the EU closer to a more forceful response, with Trump’s escalating rhetoric about the Danish territory and its supporters having prompted key capitals to harden their stance on how Europe should react. “The resolve has been there for a few days,” said one of the diplomats. “We have felt it in our bilateral talks … there is very broad support that the EU must prepare for all scenarios, and that also includes that all instruments are on the table.” What governments request of the Commission will be decided largely by what the U.S. president says in his address at the World Economic Forum in Davos on Wednesday. While several European leaders have been trying to arrange meetings with Trump on the Davos sidelines to talk him down from imposing the tariffs, they are also preparing for the possibility that Trump follows through on his threats. Trump on Saturday announced he would slap a 10 percent tariff on NATO allies that have opposed his move to take Greenland, including France, Germany, Denmark, the Netherlands, the U.K., Norway, Sweden and Finland. The U.S. leader has since escalated further, threatening a 200 percent tariff on French wine and Champagne. Aside from the anti-coercion tool, or “trade bazooka,” leaders have also discussed using an earlier retaliation package that would impose tariffs on €93 billion worth of U.S. exports. Two of the EU diplomats indicated that it is possible to impose the tariffs first, while the Commission goes through the more cumbersome process of launching the powerful trade weapon. “There is a convergence with the Germans, there’s an awakening on their part, that we have to stop being naive,” said a senior French official, referring to using the bazooka against Washington. French President Emmanuel Macron has championed the move, but other capitals have been more cautious given the risk it could trigger further measures from Trump, as well as the potential costs to their economies.  The thinking within the German government appears to be that in order to avoid a full-blown trade war with the U.S., the bloc needs to get a strong deterrent in place. “We have a set of instruments at our disposal, and we agree that we do not want to use them. But if we have to use them, then we will,” German Chancellor Friedrich Merz told reporters on Monday. The trade weapon is one of the EU’s main levers against the U.S. because it includes a wide range of possible measures such as imposing tariffs, restricting exports of strategic goods, or excluding U.S. companies from tenders. A decision to use the instrument would not be taken lightly because it would have a significant impact on the EU economy. The last time the EU considered using its bazooka against the U.S. — when Trump slapped unilateral levies on the bloc in 2025 — Europe stepped back from the brink. This time, member capitals have a higher tolerance for pain, the EU diplomats indicated.  French President Emmanuel Macron has championed the move, but other capitals have been more cautious given the risk it could trigger further measures from Trump, as well as the potential costs to their economies. | Pool Photo by Philippe Maggoni via EPA “It’s a very different situation to last summer, when it was just a trade dispute,” one of the diplomats said. “Countries said they don’t want to engage in a dispute over whether tariffs should be 10 or 15 percent, particularly when we’re dependent on the U.S. But we are not in the nice-to-do territory now, we are in the need-to-do territory.” Pulling the trigger on the ACI would require the support of at least 15 countries in the Council of the EU. Diplomats hope that Trump ally Giorgia Meloni will also get on board. As the EU’s third-biggest country, Italy’s joining the push would be an important display of unity, they said. For now Rome has indicated it would prefer to continue de-escalatory talks with Washington, while the position of fellow potential ally Poland is still unclear. However, with France and Germany’s positions converging, pressure on Rome and Warsaw to fall into line with the rest of the bloc will be intense. Key to the evolution of Germany’s position on hitting back at Trump is buy-in for such a move from industry. Bertram Kawlath, president of the VDMA German machine builders’ association, called for Brussels to consider using the anti-coercion tool, despite the fact that the European mechanical industry is “already disproportionately affected by the U.S. tariffs.”  Giorgio Leali contributed reporting. 

U.S. President Donald Trump threatened to impose 200 percent tariffs on French wine and Champagne late Monday in response to Emmanuel Macron rejecting his offer to join the “Board of Peace” tasked with overseeing the next steps in Gaza. Informed by a reporter that the French president had said he wouldn’t join the board because of concerns about its powers, Trump dismissed Macron as lacking influence and said he would be “out of office in a few months.” “I’ll put a 200 percent tariff on his wines and Champagnes, and he’ll join, but he doesn’t have to join,” Trump said during a huddle with the media. In response, a French official close to Macron who was granted anonymity as they are not authorized to speak on the record, told POLITICO: “We have taken note of Mr. Trump’s statements on wines and Champagnes. As we have always emphasized, tariff threats to influence our foreign policy are unacceptable and ineffective.” Trump announced the establishment of the board — which he touted as “the Greatest and Most Prestigious Board ever assembled at any time, any place” — on Friday as a key part of his 20-point plan to end the war between Israel and Hamas. An assortment of world leaders have been invited to join, including Russian President Vladimir Putin and Belarusian leader Alexander Lukashenko. Bloomberg reported Tuesday that Trump wants the board’s full constitution and remit to be nailed down at the World Economic Forum in Davos on Thursday — but some countries are uneasy about the details of the proposal. France’s decision to reject the offer was taken over concerns that the board, chaired by Trump, would have extensive powers beyond transitional governance of the Gaza Strip and undermine the United Nations framework. A statement from Macron’s office noted that the board’s charter “goes beyond the framework of Gaza and raises serious questions, in particular with respect to the principles and structure of the United Nations, which cannot be called into question.” Clea Caulcutt and Benjamin Johansen contributed to this report.

Europeans’ world-leading drinking habits are putting their health at risk, but governments are failing to use higher taxes to help curb consumption, warned the World Health Organization. Beer has become more affordable in 11 EU countries since 2022, and less affordable in six, the WHO report revealed Tuesday. There was a similar but even more dramatic trend for spirits, which became more affordable in 17 EU countries and less affordable in two. And for wine, 14 EU countries do not tax it at all, including big producers Italy and Spain, the report found. The EU includes seven of the 10 countries with the highest per-capita alcohol consumption globally, with Romania, Latvia and Czechia among the biggest drinkers. Alcohol is a major driver of cancer, with risk scaling alongside higher consumption. It’s also linked to a wide range of illnesses including cardiovascular disease and depression, all of which are adding pressure to stretched health systems. The WHO said governments should target alcohol consumption to protect people from its ill effects. Increasing the cost of booze through taxes is one of the most effective measures governments can take, the WHO said. Yet, some EU countries have minimal or no taxes on certain types of alcohol. The fact that more than half of EU countries don’t tax wine at all is “unusual” by international standards, WHO economist Anne-Marie Perucic said. She pointed out that the more affordable alcohol is, the more people consume. “Excluding a product is not common. It’s always for political reasons, socio-economic reasons [like] trying to protect the local industry. Clearly, it doesn’t make sense from a health perspective,” Perucic told POLITICO. Those 14 countries span the EU’s northern and central regions, such as Germany, Austria and Bulgaria. “More affordable alcohol drives violence, injuries and disease,” said Etienne Krug, director of the WHO’s department of health determinants, promotion and prevention. “While industry profits, the public often carries the health consequences and society the economic costs.” The EU has touted its plans to protect its wine industry from threats including declining consumption and climate change. EU institutions agreed a package of measures to prop up the sector in December. Meanwhile, the European Commission recently backed down from proposing an EU-wide tax on alcopops; the sweet, pre-mixed alcoholic drinks that taste like sodas, as part of its Safe Hearts plan.  In a separate report, the WHO reported that sugary drinks have also become more affordable in 13 EU countries since 2022, data published in a separate WHO report found. A diet high in sugar is linked to obesity, Type 2 diabetes, heart disease, fatty liver disease and certain cancers.

Europe’s biggest ever trade deal finally got the nod Friday after 25 years of negotiating.  It took blood, sweat, tears and tortured discussions to get there, but EU countries at last backed the deal with the Mercosur bloc — paving the way to create a free trade area that covers more than 700 million people across Europe and Latin America.  The agreement, which awaits approval from the European Parliament, will eliminate more than 90 percent of tariffs on EU exports. European shoppers will be able to dine on grass-fed beef from the Argentinian pampas. Brazilian drivers will see import duties on German motors come down.  As for the accord’s economic impact, well, that pales in comparison with the epic battles over it: The European Commission estimates it will add €77.6 billion (or 0.05 percent) to the EU economy by 2040.  Like in any deal, there are winners and losers. POLITICO takes you through who is uncorking their Malbec, and who, on the other hand, is crying into the Bordeaux. WINNERS Giorgia Meloni Italy’s prime minister has done it again. Giorgia Meloni saw which way the political winds were blowing and skillfully extracted last-minute concessions for Italian farmers after threatening to throw her weight behind French opposition to the deal.  The end result? In exchange for its support, Rome was able to secure farm market safeguards and promises of fresh agriculture funding from the European Commission — wins that the government can trumpet in front of voters back home. It also means that Meloni has picked the winning side once more, coming off as the team player despite the last-minute holdup. All in all, yet another laurel in Rome’s crown.  The German car industry  Das Auto hasn’t had much reason to cheer of late, but Mercosur finally gives reason to celebrate. Germany’s famed automotive sector will have easier access to consumers in LatAm. Lower tariffs mean, all things being equal, more sales and a boost to the bottom line for companies like Volkswagen and BMW. There are a few catches. Tariffs, now at 35 percent, aren’t coming down all at once. At the behest of Brazil, which hosts an auto industry of its own, the removal of trade barriers will be staggered. Electric vehicles will be given preferential treatment, an area that Europe’s been lagging behind on.  Ursula von der Leyen Mercosur is a bittersweet triumph for European Commission President Ursula von der Leyen. Since shaking hands on the deal with Mercosur leaders more than a year ago, her team has bent over backwards to accommodate the demands of the skeptics and build the all-important qualified majority that finally materialized Friday. Expect a victory lap next week, when the Berlaymont boss travels to Paraguay to sign the agreement. Giorgia Meloni saw which way the political winds were blowing and skillfully extracted last-minute concessions for Italian farmers after threatening to throw her weight behind French opposition to the deal. | Ettore Ferrari/EPA On the international stage, it also helps burnish Brussels’ standing at a time when the bloc looks like a lumbering dinosaur, consistently outmaneuvered by the U.S. and China. A large-scale trade deal shows that the rules-based international order that the EU so cherishes is still alive, even as the U.S. whisked away a South American leader in chains.  But the deal came at a very high cost. Von der Leyen had to promise EU farmers €45 billion in subsidies to win them over, backtracking on efforts to rein in agricultural support in the EU budget and invest more in innovation and growth.   Europe’s farmers  Speaking of farmers, going by the headlines you could be forgiven for thinking that Mercosur is an unmitigated disaster. Surely innumerable tons of South American produce sold at rock-bottom prices are about to drive the hard-working French or Polish plowman off his land, right?  The reality is a little bit more complicated. The deal comes with strict quotas for categories ranging from beef to poultry. In effect, Latin American farmers will be limited to exporting a couple of chicken breasts per European person per year. Meanwhile, the deal recognizes special protections for European producers for specialty products like Italian parmesan or French wine, who stand to benefit from the expanded market. So much for the agri-pocalpyse now.  Mercosur is a bittersweet triumph for European Commission President Ursula von der Leyen. | Olivier Matthys/EPA Then there’s the matter of the €45 billion of subsidies going into farmers’ pockets, and it’s hard not to conclude that — despite all the tractor protests and manure fights in downtown Brussels — the deal doesn’t smell too bad after all.  LOSERS Emmanuel Macron  There’s been no one high-ranking politician more steadfast in their opposition to the trade agreement than France’s President Emmanuel Macron who, under enormous domestic political pressure, has consistently opposed the deal. It’s no surprise then that France joined Poland, Austria, Ireland and Hungary to unsuccessfully vote against Mercosur.  The former investment banker might be a free-trading capitalist at heart, but he knows well that, domestically, the deal is seen as a knife in the back of long-suffering Gallic growers. Macron, who is burning through prime ministers at rates previously reserved for political basket cases like Italy, has had precious few wins recently. Torpedoing the free trade agreement, or at least delaying it further, would have been proof that the lame-duck French president still had some sway on the European stage.  Surely innumerable tons of South American produce sold at rock-bottom prices are about to drive the hard-working French or Polish plowman off his land, right? | Darek Delmanowicz/EPA Macron made a valiant attempt to rally the troops for a last-minute counterattack, and at one point it looked like he had a good chance to throw a wrench in the works after wooing Italy’s Meloni. That’s all come to nought. After this latest defeat, expect more lambasting of the French president in the national media, as Macron continues his slow-motion tumble down from the Olympian heights of the Élysée Palace.  Donald Trump Coming within days of the U.S. mission to snatch Venezuelan strongman Nicolás Maduro and put him on trial in New York, the Mercosur deal finally shows that Europe has no shortage of soft power to work constructively with like-minded partners — if it actually has the wit to make use of it smartly.  Any trade deal should be seen as a win-win proposition for both sides, and that is just not the way U.S. President Donald Trump and his art of the geopolitical shakedown works. It also has the incidental benefit of strengthening his adversaries — including Brazilian President and Mercosur head honcho Luiz Inácio Lula da Silva — who showed extraordinary patience as he waited on the EU to get their act together (and nurtured a public bromance with Macron even as the trade talks were deadlocked). China  China has been expanding exports to Latin America, particularly Brazil, during the decades when the EU was negotiating the Mercosur trade deal. The EU-Mercosur deal is an opportunity for Europe to claw back some market share, especially in competitive sectors like automotive, machines and aviation. The deal also strengthens the EU’s hand on staying on top when it comes to direct investments, an area where European companies are still outshining their Chinese competitors. Emmanuel Macron made a valiant attempt to rally the troops for a last-minute counterattack, and at one point it looked like he had a good chance to throw a wrench in the works after wooing Italy’s Meloni. | Pool photo by Ludovic Marin/EPA More politically, China has somewhat succeeded in drawing countries like Brazil away from Western points of view, for instance via the BRICS grouping, consisting of Brazil, Russia, India, China and South Africa, and other developing economies. Because the deal is not only about trade but also creates deeper political cooperation, Lula and his Mercosur counterparts become more closely linked to Europe. The Amazon rainforest  Unfortunately, for the world’s ecosystem, Mercosur means one thing: burn, baby, burn. The pastures that feed Brazil’s herds come at the expense of the nation’s once-sprawling, now-shrinking tropical rainforest. Put simply, more beef for Europe means less trees for the world. It’s not all bad news for the climate. The trade deal does include both mandatory safeguards against illegal deforestation, as well as a commitment to the Paris Climate Agreement for its signatories. 

BRUSSELS — European Commission President Ursula von der Leyen is determined to travel to South America next week to sign the EU’s long-delayed trade pact with the Mercosur bloc, but she’s having to make last-minute pledges to Europe’s farmers in order to board that flight. EU countries are set to make a pivotal decision on Friday on whether the contentious deal with Argentina, Brazil, Paraguay and Uruguay — which has been more than a quarter of a century in the making — will finally get over the line. It’s still not certain that von der Leyen can secure the majority she needs on Friday; everything boils down to whether Italy, the key swing voter, will support the accord. To secure Rome’s backing, von der Leyen on Tuesday rolled out some extra budget promises on farm funding. The target was clear: Italy’s Prime Minister Giorgia Meloni, whose refusal to back the Mercosur agreement forced von der Leyen to cancel her planned signing trip in December. At its heart, the Mercosur agreement is a drive by Europe’s big manufacturers to sell more cars, machinery and chemicals in Latin America, while the agri powerhouses of the southern hemisphere will secure greater access to sell food to Europe — a prospect that terrifies EU farmers. While Germany and Spain have long led the charge for a deal, France and Poland are dead-set against. That leaves Italy as the key member country poised to cast the deciding vote. Von der Leyen’s letter on Tuesday was carefully choreographed political theater. Writing to the EU Council presidency and European Parliament President Roberta Metsola, she offered earlier access to up to €45 billion in agricultural funding under the bloc’s next long-term budget, while reaffirming €293.7 billion in farm spending after 2027. POLITICO was the first to report on Monday that the declaration was in the works. She insisted the measures in her letter would “provide the farmers and rural communities with an unprecedented level of support, in some respects even higher than in the current budget cycle.” The money isn’t new — it’s being brought forward from an existing pot in the EU’s next long-term budget — but governments can now lock it in for farmers early, before it is reassigned during later budget negotiations. Von der Leyen framed the move as offering stability and crisis readiness, giving Meloni a tangible win she can parade to her powerful farm lobby. WILL MELONI BACK MERCOSUR? The big question is whether Italy will view von der Leyen’s promises as going far enough ahead of the crunch meeting on Friday. Early signs suggested Rome might be softening. Meloni issued a statement saying the farm funding pledge was “a positive and significant step forward in the negotiations leading to the new EU budget,” but conspicuously avoided making a direct link to Mercosur. (French President Emmanuel Macron also welcomed von der Leyen’s letter, but there’s no prospect of Paris backing Mercosur on Friday.) taly’s Prime Minister Giorgia Meloni, whose refusal to back the Mercosur agreement forced Ursula von der Leyen to cancel her planned signing trip in December. | Tom Nicholson/Getty Images Nicola Procaccini, a close Meloni ally in the European Parliament, told POLITICO: “We are moving in the right direction to enable Italy to sign Mercosur.” Right direction, but not yet at the destination? The government in Rome would not comment on whether it was about to back the deal. Germany, the EU’s industrial kingpin, is keen to secure a Mercosur agreement to boost its exports, but is still wary as to whether sufficient support exists to finalize an accord on Friday. A German official cautioned everything was still to play for. “A qualified majority is emerging, but it’s not a done deal yet. Until we have the result, there’s no reason to sit back and relax,” the official said. Optimism is growing regarding Rome in the pro-Mercosur camp, however. After all, the pact is widely viewed as strongly in the interests not only of Italy’s engineering companies, but also of its high-end wine and food producers, which are big exporters to South America. Additional curveballs are being thrown by Romania and Czechia, said one EU diplomat, who expressed concern they could turn against the deal on Friday, reducing any majority to very tight margins. The diplomat said they believed Italy would back the deal, however. FINAL STRETCH? The maneuvering is set to continue on Wednesday, when agriculture ministers descend on Brussels for what the Commission is billing as a “political meeting” after December’s farm protests. Officially, Mercosur isn’t on the agenda. Unofficially, however, it’s expected to be omnipresent — in the corridors, in the side meetings, and in the questions ministers choose not to answer. Farm ministers don’t approve trade deals, but the optics matter. Von der Leyen needs momentum — and cover — ahead of Friday’s vote. France — the country most hostile to the deal — will be vocal. On Wednesday, French Agriculture Minister Annie Genevard is expected to open yet another offensive — this time for a lower trigger on emergency safeguards related to the deal. This would reopen a compromise already struck between EU governments, the Parliament and the Commission. It’s a familiar tactic: Keep pushing. “France is still not satisfied with the proposals made by the Commission,” a French agriculture ministry official told reporters on Tuesday, while acknowledging that there has been some improvement. “Paris’ strategy for this week is still to continue to look for a blocking minority.” “Italy has its own strategy, we have ours,” added the official, who was granted anonymity in line with the rules for French government briefings. France’s allies, notably Poland, are equally blunt. Agriculture Minister Stefan Krajewski said the priority was simply “to block this agreement.” If that failed, Warsaw would seek maximum safeguards and compensation. That means it’s all coming down to the wire on Friday. A second failure to dispatch von der Leyen to finalize the agreement would be deeply embarrassing, and would only stoke Berlin’s anger at other EU countries thwarting the deal. For now, it’s still unclear whether von der Leyen will board that plane. Bartosz Brzeziński reported from Brussels, Giorgio Leali reported from Paris, and Nette Nöstlinger reported from Berlin.

Prime minister’s questions: a shouty, jeery, very occasionally useful advert for British politics. Here’s what you need to know from the latest session in POLITICO’s weekly run-through. What they sparred about: The year that was. Prime Minister Keir Starmer and Tory Leader Kemi Badenoch’s last hurrah of 2025 saw everyone’s favorite duo row about the turkey Labour’s record over the last 12 months — and who caused the nightmare before Christmas. Pull the other one: Badenoch wished everyone a festive break in the season of goodwill — but then the gloves came off. She raised the PM’s own frustration at pulling levers but struggling to get change (Labour’s favorite word). “Does he blame himself or the levers?” Cutting. Starmer used the free airtime to rattle through his achievements, stressing “I’ve got a whole list … I could go on for a very long time.” Comparisons to Santa write themselves. Jobbing off:  “The Prime Minister promised economic growth, but the only thing that’s grown is his list of broken promises,” Badenoch hit back. This list analogy was really gaining momentum. She lambasted rising unemployment under Labour, yet the PM was able to point to lower inactivity under his watch and, of course, mentioned the boost of falling inflation this morning. Backhanded compliment: Starmer, no doubt desperate for a rest, used the imminent break to “congratulate” Badenoch for breaking a record on the number of Tories defecting to Reform UK. “The question is who’s next,” he mused, enjoying the chance to focus on the Conservatives’ threat to their right, rather than Labour’s troubles to its left. Clucking their tongues: Outraged at her Shadow Cabinet getting called non-entities, Badenoch kept the seasonal attacks going by labeling the Cabinet a “bunch of turkeys.” She said Starmer was no longer a caretaker PM but the “undertaker prime minister.” Bruising stuff. Last orders: Amid all the metaphorical tinsel and bells of holly, Starmer adopted a lawyerly tone on Labour’s support for pubs (even though many greasy spoons have banned Labour MPs) and condemned ongoing industrial action by resident doctors. But the Tory leader went out on (possibly) a new low by arguing Starmer “doesn’t have the baubles” to ban medical staff from striking and said all Labour MPs want “is a new leader.” Grab the mince pies: The prime minister’s speechwriters clearly did their homework with Starmer, not a natural on the humor front, comparing the Tories to “The Muppets Christmas Carol” and joking that all the defections meant Badenoch would be “left Home Alone.” Penalty shootout: Hold the homepage — PMQs actually delivered a news line. The PM confirmed the government issued a licence to transfer to Ukraine £2.5 billion of Russian billionaire Roman Abramovich’s cash from his sale of Chelsea football club. Starmer told Abramovich to “pay up now,” or he’d be taken to court. Teal bauble: The end-of-year vibes allowed Starmer to deploy a festive jibe of advice to Reform UK: “If mysterious men from the East appear bearing gifts, this time, report it to the police!” Labour just won’t let ex-Reform UK Leader in Wales Nathan Gill’s conviction for pro-Russian bribery go. Even Nigel Farage, sat up above in the VIP public gallery, had a chuckle, admitting “that’s quite funny” to nearby hacks. Helpful backbench intervention of the week: Tipton and Wednesbury MP Antonia Bance commended the government’s efforts to support the West Midlands by striking the U.S. trade deal, ripping into Reform. The PM just couldn’t resist another attack line against his party’s main opponent. Totally unscientific scores on the doors: Starmer 8/10. Badenoch 5/10. The final PMQs exchange was never going to be a serious exchange, given the opportunity to make Christmas gags. The Tory leader followed a scattergun approach, highlighting the various broken promises, but none landed a blow. The PM, doubtless relieved to bag a few weeks away from the interrogation, brushed them off and used his pre-scripted lines to deliver a solid concluding performance.

PARIS — In France, getting rid of governments is now about as commonplace as complaining about them. François Bayrou is bracing to become the latest prime minister to get the chop on Monday ― primarily because of discontent over his spending plans for next year ― leaving President Emmanuel Macron on the hunt for a fifth PM in less than two years. The political crisis could have ramifications far beyond the halls of power in Paris if lawmakers can’t figure out how to rein in runaway public spending and a massive budget deficit. Here’s everything you need to know about the drama ahead: HE’S DEFINITELY GOING, RIGHT? Yes, it’s pretty much nailed on that Bayrou will fall. Anything else would need a last-minute U-turn from a big chunk of opposition lawmakers, and that would be a massive shock. His fate seem sealed in the hours after he unveiled his plan for a confidence vote late last month, when leaders from the far-left France Unbowed, far-right National Rally and center-left Socialist Party all announced they would vote to bring down the government. Neither Bayrou’s PR blitz nor his meetings with political leaders last week appear to have moved the needle. SO WHAT’S HAPPENING MONDAY? Bayrou is delivering what’s known as a d´eclaration de politique générale (general policy statement), a speech traditionally given at the outset of a prime minister’s tenure to lay out an incoming government’s platform and priorities. (It’s a bit like a state of the union.) The longtime centrist is using this one to make the case for his unpopular 2026 budget. Prime ministers often follow their addresses with a confidence vote to ensure support for their agendas, though they aren’t constitutionally obliged to do so. Bayrou didn’t hold a vote after his January DPG, nor did any of his predecessors during Macron’s second term. Christophe Petit Tesson/EPA This time, he will. Bayrou has tried to frame the vote as a referendum on the need for drastic action to balance the books and has quibbled with the French media’s framing of Monday’s drama as a confidence vote or censure. But in practice, that’s what it is. HOW WILL THE DAY UNFOLD? Bayrou’s speech will begin at 3 p.m. in the National Assembly in Paris, France’s more-powerful lower house of parliament. Representatives from each political party will follow, with each of their speaking times determined by how many seats they have. Then the prime minister will have the opportunity to deliver closing remarks. Voting should take place around 7 p.m. or 8 p.m. and should last about 30 minutes, after which the president of the National Assembly will announce the results. Macron’s office has not yet said whether he will speak following the vote. When ex-Prime Minister Michel Barnier was toppled in December, Macron waited 24 hours to deliver a primetime address. HOW DID WE GET HERE? Let’s rewind to June 9, 2024, when the far-right National Rally scored a huge win in the European election. Macron responded by dissolving parliament, a massive bet that backfired in spectacular fashion. In the ensuing vote, an alliance of left-leaning political parties won more seats than any other political force, but fell short of an absolute majority. After nearly two months without a proper government, Macron’s centrists and the center-right conservatives agreed to form a minority coalition led by former Brexit negotiator Barnier. Barnier lasted three months, taken down in December over his plan to trim the 2025 budget to help rein in runaway public spending. Macron replaced Barnier with Bayrou, who in July presented a plan to squeeze next year’s budget by €43.8 billion to get the budget deficit down from a projected 5.4 percent of gross domestic product this year to 4.6 percent of GDP in 2026. Opposition lawmakers howled in fury at the plan, which included axing two public holidays. In late August, as the French started to trickle back from their summer vacations, Bayrou stunned the country by announcing that he would hold a confidence vote on his spending plans before what were expected to be tense negotiations. SHOULD I CARE? Yes, because the ensuing crisis in the eurozone’s second-biggest economy could drag the entire bloc into a debt-fueled financial crisis, according to Bayrou. France was able to stave off an economic catastrophe during the pandemic and when energy prices shot up at the outset of the full-scale war in Ukraine, in part thanks to massive public spending. Finding a consensus on reining in expenditures has proven difficult, and lawmakers are loath to tighten their belts as aggressively as Bayrou wants. His plan would bring France’s budget deficit down from a projected 5.6 percent of GDP this year to 4.6 percent in 2026. The ultimate goal is to bring that figure down to 3 percent, as required by EU rules, by 2029. Financial institutions and rating agencies have repeatedly warned of consequences should France fail to act, some of which are no longer hypothetical. Borrowing costs are rising, with the yield on France’s benchmark 10-year bonds ― a useful indicator of faith in a country’s finances ― drifting away from historically safe Germany’s yields and toward those of Italy, a country long synonymous with reckless spending and unsustainable debt.   Getting the French to tighten their belts has so far proven to be Mission Impossible, but the situation is not yet so dire that it’s time to call in the IMF. Bayrou, however, is betting his political future that history will prove him right.