BRUSSELS — On Greenland’s southern tip, surrounded by snowy peaks and deep fjords, lies Kvanefjeld — a mining project that shows the giant, barren island is more than just a coveted military base. Beneath the icy ground sits a major deposit of neodymium and praseodymium, rare earth elements used to make magnets that are essential to build wind turbines, electric vehicles and high-tech military equipment. If developed, Greenland, a semi-autonomous part of Denmark, would become the first European territory to produce these key strategic metals. Energy Transition Minerals, an Australia-based, China-backed mining company, is ready to break ground. But neither Copenhagen, Brussels nor the Greenlandic government have mobilized their state power to make the project happen. In 2009, Denmark handed Greenland’s inhabitants control of their natural resources; 12 years later the Greenlandic government blocked the mine because the rare earths are mixed with radioactive uranium. Since then the project has been in limbo, bogged down in legal disputes. “Kvanefjeld illustrates how political and regulatory uncertainty — combined with geopolitics and high capital requirements — makes even strategically important projects hard to move from potential to production,” Jeppe Kofod, Denmark’s former foreign minister and now a strategic adviser to Energy Transition Minerals, told POLITICO. Kvanefjeld’s woes are emblematic of Greenland’s broader problems. Despite having enough of some rare earth elements to supply as much as 25 percent of the world’s needs — not to mention oil and gas reserves nearly as great as those of the United States, and lots of other potential clean energy metals including copper, graphite and nickel — these resources are almost entirely undeveloped. Just two small mines, extracting gold and a niche mineral called feldspar used in glassmaking and ceramics, are up and running in Greenland. And until very recently, neither Denmark nor the European Union showed much interest in changing the situation. But that was before 2023, when the EU signed a memorandum of understanding with the Greenland government to cooperate on mining projects. The EU Critical Raw Materials Act, proposed the same year, is an attempt to catch up by building new mines both in and out of the bloc that singles out Greenland’s potential. Last month, the European Commission committed to contribute financing to Greenland’s Malmbjerg molybdenum mine in a bid to shore up a supply of the metal for the EU’s defense sector.  But with United States President Donald Trump threatening to take Greenland by force, and less likely to offer the island’s inhabitants veto power over mining projects, Europe may be too late to the party. “The EU has for many years had a limited strategic engagement in Greenland’s critical raw materials, meaning that Europe today risks having arrived late, just as the United States and China have intensified their interest,” Kofod said. In a world shaped by Trump’s increasingly belligerent foreign policy and China’s hyperactive development of clean technology and mineral supply chains, Europe’s neglect of Greenland’s natural wealth is looking increasingly like a strategic blunder. With Donald Trump threatening to take Greenland by force, and less likely to offer the island’s inhabitants veto power over mining projects, Europe may be too late to the party. | Jim Watson/AFP via Getty Images A HOSTILE LAND That’s not to say building mines in Greenland, with its mile-deep permanent ice sheet, would be easy. “Of all the places in the world where you could extract critical raw materials, [Greenland] is very remote and not very easily accessible,” said Ditte Brasso Sørensen, senior analyst on EU climate and industrial policy at Think Tank Europa, pointing to the territory’s “very difficult environmental circumstances.”  The tiny population — fewer than 60,000 — and a lack of infrastructure also make it hard to build mines. “This is a logistical question,” said Eldur Olafsson, CEO of Amaroq, a gold mining company running one of the two operating mines in Greenland and also exploring rare earths and copper extraction opportunities. “How do you build mines? Obviously, with capital, equipment, but also people. [And] you need to build the whole infrastructure around those people because they cannot only be Greenlandic,” he said.  Greenland also has strict environmental policies — including a landmark 2021 uranium mining ban — which restrict resource extraction because of its impact on nature and the environment. The current government, voted in last year, has not shown any signs of changing its stance on the uranium ban, according to Per Kalvig, professor emeritus at the Geological Survey of Denmark and Greenland, a Danish government research organization. Uranium is routinely found with rare earths, meaning the ban could frustrate Greenland’s huge potential as a rare earths producer. It’s a similar story with fossil fuels. Despite a 2007 U.S. assessment that the equivalent of over 30 billion barrels in oil and natural gas lies beneath the surface of Greenland and its territorial waters — almost equal to U.S. reserves — 30 years of oil exploration efforts by a group including Chevron, Italy’s ENI and Shell came to nothing. In 2021 the then-leftist government in Greenland banned further oil exploration on environmental grounds.  Danish geologist Flemming Christiansen, who was deputy director of the Geological Survey of Denmark and Greenland until 2020, said the failure had nothing to do with Greenland’s actual potential as an oil producer. Instead, he said, a collapse in oil prices in 2014 along with the high cost of drilling in the Arctic made the venture unprofitable. Popular opposition only complicated matters, he said. THE CLIMATE CHANGE EFFECT From the skies above Greenland Christiansen sees firsthand the dramatic effects of climate change: stretches of clear water as rising temperatures thaw the ice sheets that for centuries have made exploring the territory a cold, costly and hazardous business. “If I fly over the waters in west Greenland I can see the changes,” he said. “There’s open water for much longer periods in west Greenland, in Baffin Bay and in east Greenland.” Climate change is opening up this frozen land. Climate change is opening up this frozen land. | Odd Andersen/AFP via Getty Images Greenland contains the largest body of ice outside Antarctica, but that ice is melting at an alarming rate. One recent study suggests the ice sheet could cease to exist by the end of the century, raising sea levels by as much as seven meters. Losing a permanent ice cap that is several hundred meters deep, though, “gradually improves the business case of resource extraction, both for … fossil fuels and also critical raw materials,” said Jakob Dreyer, a researcher at the University of Copenhagen.   But exploiting Greenland’s resources doesn’t hinge on catastrophic levels of global warming. Even without advanced climate change, Kalvig, of the Geological Survey of Denmark and Greenland, argues Greenland’s coast doesn’t differ much from that of Norway, where oil has been found and numerous excavation projects operate.     “You can’t penetrate quite as far inland as you can [in Norway], but once access is established, many places are navigable year-round,” Kalvig said. “So, in that sense, it’s not more difficult to operate mines in Greenland than it is in many parts of Norway, Canada or elsewhere — or Russia for that matter. And this has been done before, in years when conditions allowed.”    A European Commission spokesperson said the EU was now working with Greenland’s government to develop its resources, adding that Greenland’s “democratically elected authorities have long favored partnerships with the EU to develop projects beneficial to both sides.” But the spokesperson stressed: “The fate of Greenland’s raw mineral resources is up to the Greenlandic people and their representatives.” The U.S. may be less magnanimous. Washington’s recent military operation in Venezuela showed that Trump is serious about building an empire on natural resources, and is prepared to use force and break international norms in pursuit of that goal. Greenland, with its vast oil and rare earths deposits, may fit neatly into his vision. Where the Greenlandic people fit in is less clear.

LONDON — U.K. ministers are warning Elon Musk’s X it faces a ban if it doesn’t get its act together. But outlawing the social media platform is easier said than done. The U.K.’s communications regulator Ofcom on Monday launched a formal investigation into a deluge of non-consensual sexualized deepfakes produced by X’s AI chatbot Grok amid growing calls for action from U.K. politicians. It will determine whether the creation and distribution of deepfakes on the platform, which have targeted women and children, constitutes a breach of the company’s duties under the U.K.’s Online Safety Act (OSA).   U.K. ministers have repeatedly called for Ofcom, the regulator tasked with policing social media platforms, to take urgent action over the deepfakes. U.K. Technology Secretary Liz Kendall on Friday offered her “full support” to the U.K. regulator to block X from being accessed in the U.K., if it chooses to. “I would remind xAI that the Online Safety Act Includes the power to block services from being accessed in the U.K., if they refuse to comply with U.K. law. If Ofcom decide to use those powers they will have our full support,” she said in a statement. The suggestion has drawn Musk’s ire. The tech billionaire branded the British government “fascist” over the weekend, and accused it of “finding any excuse for censorship.”   With Ofcom testing its new regulatory powers against one of the most high-profile tech giants for the first time, it is hard to predict what happens next. NOT GOING NUCLEAR — FOR NOW   Ofcom has so far avoided its smash-glass option. Under the OSA it could seek a court order blocking “ancillary” services, like those those processing subscription payments on X’s behalf, and ask internet providers to block X from operating in the U.K.   Taking that route would mean bypassing a formal investigation, but that is generally considered a last resort according to Ofcom’s guidance. To do so, Ofcom would need to prove that risk of harm to U.K. users is particularly great.  Before launching its investigation Monday, the regulator made “urgent contact” with X on Jan. 5, giving the platform until last Friday to respond. Ofcom stressed the importance of “due process” and of ensuring its investigations are “legally robust and fairly decided.”   LIMITED REACH   The OSA only covers U.K. users. It’s a point ministers have been keen to stress amid concerns its interaction with the U.S. First Amendment, which guarantees free speech, could become a flashpoint in trade negotiations with Washington. It’s not enough for officials or ministers to believe X has failed to protect users generally.   The most egregious material might not even be on X. Child sexual abuse charity the Internet Watch Foundation said last week that its analysts had found what appeared to be Grok-produced Child sexual abuse material (CSAM) on a dark web forum, rather than X itself — so it’s far from self-evident that Ofcom taking the nuclear option against X would ever have been legally justified.   X did not comment on Ofcom’s investigation when contacted by POLITICO, but referred back to a statement issued on Jan. 4 about the issue of deepfakes on the platform. “We take action against illegal content on X, including Child Sexual Abuse Material (CSAM), by removing it, permanently suspending accounts, and working with local governments and law enforcement as necessary. Anyone using or prompting Grok to make illegal content will suffer the same consequences as if they upload illegal content,” the statement said. BIG TEST   The OSA came into force last summer, and until now Ofcom’s enforcement actions have focused on pornography site providers for not implementing age-checks.  Online safety campaigners have argued this indicates Ofcom is more interested in going after low-hanging fruit than challenging more powerful tech companies. “It has been striking to many that of the 40+ investigations it has launched so far, not one has been directed at large … services,” the online safety campaign group the Molly Rose Foundation said in September.   That means the X investigation is the OSA’s first big test, and it’s especially thorny because it involves an AI chatbot. The Science, Innovation and Technology committee wrote in a report published last summer that the legislation does not provide sufficient protections against generative AI, a point Technology Secretary Liz Kendall herself conceded in a recent evidence session.  POLITICAL RISKS  If Ofcom concludes X hasn’t broken the law there are likely to be calls from OSA critics, both inside and outside Parliament, to return to the drawing board. It would also put the government, which has promised to act if Ofcom doesn’t, in a tricky spot.  The PM’s spokesperson on Monday described child sexual abuse imagery as “the worst crimes imaginable.” Ofcom could also conclude X has broken the law, but decide against imposing sanctions, according to its enforcement guidance. The outcome of Ofcom’s investigation will be watched closely by the White House and is fraught with diplomatic peril for the U.K. government, which has already been criticized for implementing the new online safety law by Donald Trump and his allies. Foreign Secretary David Lammy raised the Grok issue with U.S. Vice President JD Vance last week, POLITICO reported.  But other Republicans are readying for a geopolitical fight: GOP Congresswoman Anna Paulina Luna, a member of the U.S. House foreign affairs committee, said she was drafting legislation to sanction the U.K. if X does get blocked. 

LONDON — Choosing your Brexit camp was once the preserve of Britain’s Tories. Now Labour is joining in the fun.  Six years after Britain left the EU, a host of loose — and mostly overlapping — groupings in the U.K.’s ruling party are thinking about precisely how close to try to get to the bloc. They range from customs union enthusiasts to outright skeptics — with plenty of shades of grey in between. There’s a political urgency to all of this too: with Prime Minister Keir Starmer tanking in the polls, the Europhile streak among many Labour MPs and members means Brexit could become a key issue for anyone who would seek to replace him. “The more the screws and pressure have been on Keir around leadership, the more we’ve seen that play to the base,” said one Labour MP, granted anonymity like others quoted in this piece to speak frankly. Indeed, Starmer started the new year explicitly talking up closer alignment with the European Union’s single market. At face value, nothing has changed: Starmer’s comments reflect his existing policy of a “reset” with Brussels. His manifesto red lines on not rejoining the customs union or single market remain. Most of his MPs care more about aligning than how to get there. In short, this is not like the Tory wars of the late 2010s. Well, not yet. POLITICO sketches out Labour’s nascent Brexit tribes. THE CUSTOMS UNIONISTS  It all started with a Christmas walk. Health Secretary Wes Streeting told an interviewer he desires a “deeper trading relationship” with the EU — widely interpreted as hinting at joining a customs union. This had been a whispered topic in Labour circles for a while, discussed privately by figures including Starmer’s economic adviser Minouche Shafik. Deputy Prime Minister David Lammy said last month that rejoining a customs union is not “currently” government policy — which some took as a hint that the position could shift. But Streeting’s leadership ambitions (he denies plotting for the top job) and his willingness to describe Brexit as a problem gave his comments an elevated status among Labour Europhiles.  “This has really come from Wes’s leadership camp,” said one person who talks regularly to No. 10 Downing Street. Naomi Smith, CEO of the pro-EU pressure group Best for Britain, added any Labour leadership contest will be dominated by the Brexit question. MPs and members who would vote in a race “are even further ahead than the public average on all of those issues relating to Europe,” she argued. Joining a customs union would in theory allow smoother trade without returning to free movement of people. But Labour critics of a customs union policy — including Starmer himself — argue it is a non-starter because it would mean tearing up post-Brexit agreements with other countries such as India and the U.S. “It’s just absolutely nonsense,” said a second Labour MP.    Keir Starmer has argued that the customs union route would mean hard conversations with workers in the car industry after Britain secured a U.K.-U.S. tariff deal last summer. | Colin McPherson/Getty Images And since Streeting denies plotting and did not even mention a customs union by name, the identities of the players pushing for one are understandably murky beyond the 13 Labour MPs who backed a Liberal Democrat bill last month requiring the government to begin negotiations on joining a bespoke customs union with the EU. One senior Labour official said “hardly any” MPs back it, while a minister said there was no organized group, only a vague idea. “There are people who don’t really know what it is, but realize Brexit has been painful and the economy needs a stimulus,” they said. “And there are people who do know what this means and they effectively want to rejoin. For people who know about trade, this is an absolute non-starter.” Anand Menon, director of the UK in a Changing Europe think tank, said a full rejoining of the EU customs union would mean negotiating round a suite of “add-ons” — and no nations have secured this without also being in the EU single market. (Turkey has a customs union with the EU, but does not benefit from the EU’s wider trade agreements.) “I’m not convinced the customs union works without the single market,” Menon added.  Starmer has argued that the customs union route would mean hard conversations with workers in the car industry after Britain secured a U.K.-U.S. tariff deal last summer, a person with knowledge of his thinking said. “When you read anything from any economically literate commentator, the customs union is not their go-to,” added the senior Labour official quoted above. “Keir is really strong on it. He fully believes it isn’t a viable route in the national interest or economic interest.” THE SINGLE MARKETEERS (A.K.A. THE GOVERNMENT) Starmer and his allies, then, want to park the customs union and get closer to the single market.  Paymaster General Nick Thomas-Symonds has long led negotiations along these lines through Labour’s existing EU “reset.” He and Starmer recently discussed post-Brexit policy on a walk through the grounds of the PM’s country retreat, Chequers. Working on the detail with Thomas-Symonds is Michael Ellam, the former director of communications for ex-PM Gordon Brown, now a senior civil servant in the Cabinet Office. Ellam is “a really highly regarded, serious guy” and attends regular meetings with Brussels officials, said a second person who speaks regularly to No. 10.   A bill is due to be introduced to the U.K. parliament by summer which will allow “dynamic” alignment with new EU laws in areas of agreement. Two people with knowledge of his role said the bill will be steered through parliament by Cabinet Office Minister Chris Ward, Starmer’s former aide and close ally, who was by his side when Starmer was shadow Brexit secretary during the “Brexit wars” of the late 2010s. Starmer himself talked up this approach in a rare long-form interview this week with BBC host Laura Kuenssberg, saying: “We are better looking to the single market rather than the customs union for our further alignment.” While the PM’s allies insist he simply answered a question, some of his MPs spy a need to seize back the pro-EU narrative. The second person who talks regularly to No. 10 argued a “relatively small … factional leadership challenge group around Wes” is pushing ideas around a customs union, while Starmer wants to “not match that but bypass it, and say actually, we’re doing something more practical and potentially bigger.”  A third Labour MP was blunter about No. 10’s messaging: “They’re terrified and they’re worrying about an internal leadership challenge.” Starmer’s allies argue that their approach is pragmatic and recognizes what the EU will actually be willing to accept. Christabel Cooper, director of research at the pro-Labour think tank Labour Together — which plans polling and focus groups in the coming months to test public opinion on the issue — said: “We’ve talked to a few trade experts and economists, and actually the customs union is not all that helpful. To get a bigger bang for your buck, you do need to go down more of a single market alignment route.”  Stella Creasy argued that promising a Swiss-style deal in Labour’s next election manifesto (likely in 2029) would benefit the economy — far more than the “reset” currently on the table. | Nicola Tree/Getty Images Nick Harvey, CEO of the pro-EU pressure group European Movement UK, concurred: “The fact that they’re now talking about a fuller alignment towards the single market is very good news, and shows that to make progress economically and to make progress politically, they simply have to do this.”  But critics point out there are still big questions about what alignment will look like — or more importantly, what the EU will go for.  The bill will include areas such as food standards, animal welfare, pesticide use, the EU’s electricity market and carbon emissions trading, but talks on all of these remain ongoing. Negotiations to join the EU’s defense framework, SAFE, stalled over the costs to Britain. Menon said: “I just don’t see what [Starmer] is spelling out being practically possible. Even at the highest levels there has been, under the Labour Party, quite a degree of ignorance, I think, about how the EU works and what the EU wants.   “I’ve heard Labour MPs say, well, they’ve got a veterinary deal with New Zealand, so how hard can it be? And you want to say, I don’t know if you’ve noticed, but New Zealand doesn’t have a land border with the EU.”  THE SWISS BANKERS Then there are Europhile MPs, peers and campaigners who back aligning with the single market — but going much further than Starmer.  For some this takes the form of a “Swiss-style” deal, which would allow single market access for some sectors without rejoining the customs union.   This would plough through Starmer’s red lines by reintroducing EU freedom of movement, along with substantial payments to Brussels.  But Stella Creasy, chair of the Labour Movement for Europe (LME), argued that promising a Swiss-style deal in Labour’s next election manifesto (likely in 2029) would benefit the economy — far more than the “reset” currently on the table. She said: “If you could get a Swiss-style deal and put it in the manifesto … that would be enough for businesses to invest.”  Creasy said LME has around 150 MPs as members and holds regular briefings for them. While few Labour MPs back a Swiss deal — and various colleagues see Creasy as an outlier — she said MPs and peers, including herself, plan to put forward amendments to the dynamic alignment bill when it goes through parliament.  Tom Baldwin, Starmer’s biographer and the former communications director of the People’s Vote campaign (which called for a second referendum on Brexit), also suggests Labour could go further in 2029. “Keir Starmer’s comments at the weekend about aligning with — and gaining access to — the single market open up a whole range of possibilities,” he said. “At the low end, this is a pragmatic choice by a PM who doesn’t want to be forced to choose between Europe and America.   “At the upper end, it suggests Labour may seek a second term mandate at the next election by which the U.K. would get very close to rejoining the single market. That would be worth a lot more in terms of economic growth and national prosperity than the customs union deal favoured by the Lib Dems.”  A third person who speaks regularly to No. 10 called it a “boil the frog strategy.” They added: “You get closer and closer and then maybe … you go into the election saying ‘we’ll try to negotiate something more single markety or customs uniony.’”  THE REJOINERS? Labour’s political enemies (and some of its supporters) argue this could all lead even further — to rejoining the EU one day. “Genuinely, I am not advocating rejoin now in any sense because it’s a 10-year process,” said Creasy, who is about as Europhile as they come in Labour. “Our European counterparts would say ‘hang on a minute, could you actually win a referendum, given [Reform UK Leader and Brexiteer Nigel] Farage is doing so well?’”  With Prime Minister Keir Starmer tanking in the polls, the Europhile streak among many Labour MPs and members means Brexit could become a key issue for anyone who would seek to replace him. | Tom Nicholson/Getty Images Simon Opher, an MP and member of the Mainstream Labour group closely aligned with Burnham, said rejoining was “probably for a future generation” as “the difficulty is, would they want us back?” But look into the soul of many Labour politicians, and they would love to still be in the bloc — even if they insist rejoining is not on the table now. Andy Burnham — the Greater Manchester mayor who has flirted with the leadership — remarked last year that he would like to rejoin the EU in his lifetime (he’s 56). London Mayor Sadiq Khan said “in the medium to long term, yes, of course, I would like to see us rejoining.” In the meantime Khan backs membership of the single market and customs union, which would still go far beyond No. 10’s red lines.  THE ISSUES-LED MPS Then there are the disparate — yet overlapping — groups of MPs whose views on Europe are guided by their politics, their constituencies or their professional interests. To Starmer’s left, backbench rebels including Richard Burgon and Dawn Butler backed the push toward a customs union by the opposition Lib Dems. The members of the left-wing Socialist Campaign Group frame their argument around fears Labour will lose voters to other progressive parties, namely the Lib Dems, Greens and SNP, if they fail to show adequate bonds with Europe. Some other, more centrist MPs fear similar. Labour MPs with a military background or in military-heavy seats also want the U.K. and EU to cooperate further. London MP Calvin Bailey, who spent more than two decades in the Royal Air Force, endorsed closer security relations between Britain and France through greater intelligence sharing and possibly permanent infrastructure. Alex Baker, whose Aldershot constituency is known as the home of the British Army, backed British involvement in a global Defense, Security and Resilience Bank, arguing it could be key to a U.K.-EU Defence and Security Pact. The government opted against joining such a scheme.   Parliamentarians keen for young people to bag more traveling rights were buoyed by a breakthrough on Erasmus+ membership for British students at the end of last year. More than 60 Labour MPs earlier signed a letter calling for a youth mobility scheme allowing 18 to 30-year-olds expanded travel opportunities on time limited visas. It was organized by Andrew Lewin, the Welywn Hatfield MP, and signatories included future Home Office Minister Mike Tapp (then a backbencher).  Labour also has an influential group of rural MPs, most elected in 2024, who are keen to boost cooperation and cut red tape for farmers. Rural MP Steve Witherden, on the party’s left, said: “Three quarters of Welsh food and drink exports go straight to the EU … regulatory alignment is a top priority for rural Labour MPs. Success here could point the way towards closer ties with Europe in other sectors.”  THE NOT-SO-SECRET EUROPHILES (A.K.A. ALL OF THE ABOVE) Many Labour figures argue that all of the above are actually just one mega-group — Labour MPs who want to be closer to Brussels, regardless of the mechanism. Menon agreed Labour camps are not formalized because most Labour MPs agree on working closely with Brussels. “I think it’s a mishmash,” he said. But he added: “I think these tribes will emerge or develop because there’s an intra-party fight looming, and Brexit is one of the issues people use to signal where they stand.” A fourth Labour MP agreed: “I didn’t think there was much of a distinction between the camps of people who want to get closer to the EU. The first I heard of that was over the weekend.”  The senior Labour official quoted above added: “I don’t think it cuts across tribes in such a clear way … a broader group of people just want us to move faster in terms of closeness into the EU, in terms of a whole load of things. I don’t think it fits neatly.” For years MPs were bound by a strategy of talking little about Brexit because it was so divisive with Labour’s voter base. That shifted over 2025. Labour advisers were buoyed by polls showing a rise in “Bregret” among some who voted for Brexit in 2016, as well as changing demographics (bluntly, young voters come of age while older voters die).  No. 10 aides also noted last summer that Farage, the leader of the right-wing populist party Reform UK, was making Brexit less central to his campaigning. Some aides (though others dispute this) credit individual advisers such as Tim Allan, No. 10’s director of communications, as helping a more openly EU-friendly media strategy into being. For all the talk of tribes and camps, Labour doesn’t have warring Brexit factions in the same way that the Tories did at the height of the EU divorce in the 2010s. | Jakub Porzycki/Getty Images THE BLUE LABOUR HOLDOUTS  Not everyone in Labour wants to hug Brussels tight.  A small but significant rump of Labour MPs, largely from the socially conservative Blue Labour tribe, is anxious that pursuing closer ties could be seen as a rejection of the Brexit referendum — and a betrayal of voters in Leave-backing seats who are looking to Reform. One of them, Liverpool MP Dan Carden, said the failure of both London and Brussels to strike a recent deal on defense funding, even amid threats from Russia, showed Brussels is not serious.   “Any Labour MP who thinks that the U.K. can get closer to the single market or the customs union without giving up freedoms and taking instruction from an EU that we’re not a part of is living in cloud cuckoo land,” he said. A similar skepticism of the EU’s authority is echoed by the Tony Blair Institute (TBI), led by one of the most pro-European prime ministers in Britain’s history. The TBI has been meeting politicians in Brussels and published a paper translated into French, German and Italian in a bid to shape the EU’s future from within.   Ryan Wain, the TBI’s senior director for policy and politics, argued: “We live in a G2 world where there are two superpowers, China and the U.S. By the middle of this century there will likely be three, with India. To me, it’s just abysmal that Europe isn’t mentioned in that at all. It has massive potential to adapt and reclaim its influence, but that opportunity needs to be unlocked.”  Such holdouts enjoy a strange alliance with left-wing Euroskeptics (“Lexiteers”), who believe the EU does not have the interests of workers at its heart. But few of these were ever in Labour and few remain; former Leader Jeremy Corbyn has long since been cast out. At the same time many Labour MPs in Leave-voting areas, who opposed efforts to stop Brexit in the late 2010s, now support closer alignment with Brussels to help their local car and chemical industries. As such, there are now 20 or fewer MPs holding their noses on closer alignment. Just three Labour MPs, including fellow Blue Labour supporter Jonathan Brash, voted against a bill supporting a customs union proposed by the centrist, pro-Europe Lib Dems last month.  WHERE WILL IT ALL END?  For all the talk of tribes and camps, Labour doesn’t have warring Brexit factions in the same way that the Tories did at the height of the EU divorce in the 2010s. Most MPs agree on closer alignment with the EU; the question is how they get there.  Even so, Menon has a warning from the last Brexit wars. Back in the late 2010s, Conservative MPs would jostle to set out their positions — workable or otherwise. The crowded field just made negotiations with Brussels harder. “We end up with absolutely batshit stupid positions when viewed from the EU,” said Menon, “because they’re being derived as a function of the need to position yourself in a British political party.” But few of these were ever in Labour and few remain; former Leader Jeremy Corbyn has long since been cast out. | Seiya Tanase/Getty Images The saving grace could be that most Labour MPs are united by a deeper gut feeling about the EU — one that, Baldwin argues, is reflected in Starmer himself. The PM’s biographer said: “At heart, Keir Starmer is an outward-looking internationalist whose pro-European beliefs are derived from what he calls the ‘blood-bond’ of 1945 and shared values, rather than the more transactional trade benefits of 1973,” when Britain joined the European Economic Community.  All that remains is to turn a “blood-bond” into hard policy. Simple, right?

President Donald Trump’s Cabinet officials are scheduling their first formal calls with oil company CEOs to press them to revive Venezuela’s flagging oil production, four people familiar with the conversations told POLITICO. Calls that Energy Secretary Chris Wright and Interior Secretary Doug Burgum are planning with chief executives represent some of the first official outreach that the administration has made to the U.S. companies after months of informal discussions with people in the sector, these people said — days after President Donald Trump told reporters that “our very large United States oil companies” will “spend billions of dollars” in Venezuela. However, the companies’ executives remain wary of entering a socialist-ruled country that was plunged into political upheaval after U.S. forces took strongman Nicolás Maduro into custody over the weekend, following decades of neglect in its nationalized oil fields, according to market analysts and industry officials. Industry officials are also discussing what types of incentives would be needed to get them to return to the country, according to two industry officials familiar with the plans who were granted anonymity because they were not authorized to talk to the media. Those could include having the U.S. government signing contracts guaranteeing payment and security or forming public-private joint ventures. Even if they don’t yet have fully formed ideas for what would get them to invest in Venezuela, Trump’s insistence is difficult to ignore, said one former administration agency head who was granted anonymity to discuss the evolving matters. “Most companies have been thinking about this for a while. All of the big folks are probably thinking about it — and very, very, very hard,” the person said. “It’s a pretty powerful thing when the president of the United States says, ‘I need you to do this.’” Publicly, the White House expressed confidence. “All of our oil companies are ready and willing to make big investments in Venezuela that will rebuild their oil infrastructure, which was destroyed by the illegitimate Maduro regime,” spokesperson Taylor Rogers said in a statement. “American oil companies will do an incredible job for the people of Venezuela and will represent the United States well.” One person said the administration also “hopes” the American Petroleum Institute, the powerful trade association representing oil companies working in the United States, would form a task force to advise the White House on how best to revive Venezuelan oil production. “In nearly all cases, these calls are the first outreach from the administration on Venezuela,” the person said. API is “closely watching developments involving Venezuela and any potential implications for global energy markets,” group spokesperson Justin Prendergast said in response to questions. “Events like this underscore the importance of strong U.S. energy leadership. Globally, energy companies make investment decisions based on stability, the rule of law, market forces and long-term operational considerations,” Prendergast said. Trump told reporters on Sunday that he had spoken to U.S. oil companies “before and after” the military operation that seized Maduro and brought him to New York, where the former Venezuelan leader made his first court appearance on Monday. “And they want to go in, and they’re going to do a great job for the people of Venezuela, and they’re going to represent us well,” Trump continued. Industry executives on Monday told Reuters no such outreach had occurred to oil majors Exxon Mobil, ConocoPhillips and Chevron, all of which have experience working in Venezuela’s oil fields. Bringing Venezuela’s oil production — now around 1 million barrels a day — back to its glory-days’ height of 3 million barrels a day would require at least $183 billion and more than a decade of effort, industry analyst firm Rystad Energy said Monday. While the Venezuelan government might supply some of that money, international companies would need to spend $35 billion in the next few years to reach that goal. “Rystad Energy believes that around $53 billion of oil and gas upstream and infrastructure investment is needed over the next 15 years just to keep Venezuela’s crude oil production flat at 1.1 million” barrels a day, the firm said in a client note. “Going beyond 1.4 million [barrels a day] is possible but would require a stable investment of $8 [billion]-$9 billion per year from 2026 to 2040, on top of ‘hold-flat’ capital requirements.” ConocoPhillips spokesperson Dennis Nuss said in a statement that it would be “premature to speculate on any future business activities or investments,” but said the company is monitoring the “potential implications for global energy supply and stability” from the events in Venezuela. ConocoPhillips is continuing its efforts to collect more than $10 billion in compensation it was awarded in arbitration for the Venezuelan government’s seizure of the company’s assets in 2007, Nuss said. Exxon Mobil and Chevron did not respond to requests for comment. Oil field services companies Halliburton and Baker Hughes did not respond for comment, and SLB declined to comment. The only company to publicly indicate interest in Venezuela has been Continental Resources, a firm led by Trump ally and informal energy adviser Harold Hamm. Hamm told the Financial Times on Sunday that “with improved regulatory and governmental stability we would definitely consider future investment.” Continental, which played a key role in developing oil fracking technology, has never operated outside the United States — though it announced on Monday a deal in which it would buy assets in Argentina. People in the oil industry have said a major concern is that Venezuela is not stable enough to guarantee the safety of any workers and equipment they might send there. Companies are asking that the U.S. government contract directly with them before they commit to entering the country. “We need some boots-on-the-ground security and some financial security. That’s on top of the list,” said a second industry executive familiar with the talks who was granted anonymity to discuss private conversations. Trump’s decision to allow Maduro’s second-in-command, acting President Delcy Rodríguez, and other members of the regime to remain in charge of the country’s government has also made industry executives wary of taking on the job, this person added. Rodríguez and her family had been part of the Venezuelan government under Hugo Chávez in the mid-2000s when the regime seized the assets of foreign oil companies. Colombia, Canada, the EU and the United States have levied sanctions against her after accusing her of undermining the Venezuelan elections. “Who’s running the game here?” the second industry executive said. “If she’s going to be in charge — plus the guys who have been there all along — what guarantee can you give us that stuff is going to change? Those three issues — physical, financial and political security — have to be settled before anyone goes in.” Longtime Republican foreign policy hand Elliott Abrams, who served as Trump’s special envoy to Venezuela during his first term, said the president is “exaggerating” the likelihood that companies will return to the country, given the risk and capital required. “The president seems to suggest that he will make the decision, but that is not right — the boards of these companies will make the decisions,” said Abrams, who is now senior fellow for Middle Eastern studies at the Council on Foreign Relations. “I expect that you’ll see all of them now say, ‘This is fantastic, it’s a great opportunity, and we have a team ready to go to Venezuela,’ but that’s politics,” he added. “That doesn’t mean they’re going to invest.”

BRUSSELS — When cocoa farmer Leticia Yankey came to Brussels last October, she had a simple message for the EU: Think about the mess your simplification agenda is creating for companies and communities. It was just weeks after the European Commission said it might delay the EU’s anti-deforestation law, which requires companies to prove the goods they import into the region are not produced on deforested land, for the second time. But in Yankey’s Ghana, cocoa farmers were ready for the rules, known as the EU Deforestation Regulation or EUDR, to kick in. “How are we going to be taken serious the next time we move to our communities, our farmers, and even the [Licensed Buying Companies] to tell them that EUDR is … coming back?” Yankey asked.  Since then, the Commission has kept making changes to the plan. First by floating the delay, then backtracking but proposing tweaks to the law — only for EU governments and lawmakers to reinstate the postponement, pile on additional carve-outs and then leave open the door for further changes in the spring. All within three months. It’s not just smaller companies and remote communities that are rankled by the EU’s will-they-won’t-they approach to lawmaking. Bart Vandewaetere, a VP for government relations and ESG engagement at Nestlé, says that when he reports on European legislative developments to the company board, they “[look] a little bit at me like: ‘Okay, what’s next? Will you come next week with something else, or do we need to implement it this way, or we wait?’” Since the start of Ursula von der Leyen’s second term as European Commission President, the EU has been rolling back dozens of rules in a bid to make it easier for businesses to make money and create jobs.   Encouraged by EU leaders to hack back regulations quickly and without fuss, the Commission presented 10 simplification packages last year — on top of its plan to loosen the anti-deforestation law — to water down rules in the agricultural, environment, tech, defense and automotive sectors as well as on access to EU funding. COMPLICATION AGENDA Brussels says it is answering the wishes of business for less paperwork and fewer legislative constraints, which companies claim prevent them from competing with their U.S. and Chinese rivals. It also promises billions in savings as a result. “We will accelerate the work, as a matter of utmost priority, on all proposals with a simplification and competitiveness dimension,” the EU institutions wrote this month in a joint declaration of priorities for the year ahead. The ones who got ready to implement the laws already even go as far as to say the EU is losing one of its key appeals: being a regulatory powerhouse with policies that encourage companies to transition towards more sustainable business models. | Nicolas Economou/NurPhoto via Getty Images But for many businesses, the frequent introduction, pausing and rewriting of EU rules is, just making life more complicated. “What we constantly hear from clients is that regulatory uncertainty makes it difficult to plan ahead,” said Thomas Delille, a partner at global law firm Squire Patton Boggs, even though they generally support the simplification agenda. The ones who got ready to implement the laws already even go as far as to say the EU is losing one of its key appeals: being a regulatory powerhouse with policies that encourage companies to transition towards more sustainable business models. “The European Union unfortunately has lost some trust in the boardrooms by making simplifications that are maybe undermining predictability,” said Nestlé’s Vandewaetere. The risk is that the EU will shoot itself in the foot by making it harder for companies to invest in the region, which is essential for competitiveness.  “This approach rewards the laggards,” said Tsvetelina Kuzmanova, senior project manager as the Cambridge Institute for Sustainability Leadership, adding that it “lowers expectations at the very moment when companies need clarity and policy stability to invest.” INEVITABLE TURBULENCE Many of Europe’s decision-makers are convinced that undoing business rules is a necessary step in boosting economic growth.  The simplification measures “were needed and they are needed,” said Danish Environment Minister Magnus Heunicke, confirming that he believes the EU regulatory environment is clearer now for businesses than it was a year ago. Denmark, which held the rotating presidency of the Council of the EU for the last six months, had led much of the negotiations on the simplification packages, or “omnibuses” in Brussels parlance. Brussels is also receiving as many calls from businesses to speed up its deregulation drive as those urging caution. For example, European agriculture and food chain lobbies like Copa-Cogeca and FoodDrink Europe said in a joint appeal that the EU should “address the regulatory, administrative, legal, practical and reporting burdens that agri-food operators are facing.” These, they added, are major obstacles to investing in sustainability and productivity. Successive omnibus packages should, meanwhile, be “proposed whenever necessary.” But undoing laws requires as much work and time as drafting them. Over the past year, lawmakers and EU governments have been enthralled in deeply political negotiations over these packages. Entire teams of diplomats, elected officials, assistants, translators and legal experts have been mobilized to argue over technical detail that many were engaged in drafting just a couple of years earlier.   Of the 10 omnibus proposals, three have already been finalized. The EU has also paused the implementation of the rules it’s currently reviewing so that companies don’t have to comply while the process is ongoing. “If you look at this from an industry perspective, there will be some turbulence before there is simplification, it’s inevitable,” said Gerard McElwee, another partner at Squire Patton Boggs.  Ironically, the EU has also faced criticism for making cuts too quickly — particularly to rules on environmental protection — and without properly studying the effect they would have on Europe’s economy and communities. Yankey, the cocoa farmer, said she understands the Commission’s quandary. “They just want to listen to both sides,” she said. “Somebody is ready, somebody is not ready.” But her community will need more EU support to help understand and adapt to legislative tweaks that impact them. The constant changes do not “help us to build confidence in the rules or the game that we are playing,” she said.

The top American basketball league has a megabucks plan to take over the European market. But it’s no slam dunk. European officials and major sports leagues are trying to hamstring the National Basketball Association — home to global superstars including LeBron James and Steph Curry — before it can get off the ground ahead of a mooted 2027 launch in key cities around the continent. Proponents of the NBA-backed European competition reckon it will be an essential investment for a widely popular sport that doesn’t turn a massive profit in Europe across smaller domestic tournaments. Opponents say the global behemoth’s entry across the continent would stifle national basketball leagues and instead funnel cash to American companies. The divide comes at a moment of major commercial and political tension, with U.S. President Donald Trump’s administration attempting to bend European legislators and regulators to its America-first agenda. Basketball also marks the latest clash in a broader debate over the European sports model, which is based on promotion and relegation between leagues, and solidarity payments across a pyramidal structure. The NBA operates under the American sports model, in which franchises maintain permanent places in closed leagues, generating significant revenues for team owners and creating highly paid superstars matched only by top European football clubs. For this account of the backroom negotiating currently taking place between some of the world’s most powerful sports officials, POLITICO spoke to several European political figures, sports executives and industry heavyweights with direct knowledge of talks, some of whom were granted anonymity to discuss sensitive deliberations.   NBA executives have already been sounding out Europe’s biggest multi-sport club owners and team officials about backing the project, triggering unease from other parts of the continent’s sports establishment. “The main reason we don’t support NBA Europe is that closed leagues and competitions benefit only the top percent of the commercially successful clubs, but cause significant harm to the sport at national level,” one senior European government official told POLITICO.  While the EU doesn’t run sports in Europe, it does police the marketplace in which sports operate — and officials were quick to defend the values the EU seeks to uphold.  “As policymakers, including at EU level, there is a clear duty to uphold the competition acquis, but also to give full weight to the wider EU values repeatedly underlined in court judgments, such as solidarity, openness, and fairness,” EU Sports Commissioner Glenn Micallef told POLITICO.  He added: “The current debate suggests that this balance requires recalibration, placing greater emphasis on those values to safeguard the integrity of European sport and its pyramidal model.” PRIVATE NEGOTIATIONS Business titans have long eyed the European sports market as an attractive commercial proposition, buying clubs and even moving to upend existing competitions. Proponents of the NBA-backed European competition reckon it will be an essential investment for a widely popular sport that doesn’t turn a massive profit in Europe across smaller domestic tournaments. | Gray Mortimore/Getty Images A previous attempt to set up a semi-closed American-style football league in Europe — the ill-fated Super League bid by a group of 12 leading clubs in 2021 — hit a wall of political and public resistance. Basketball is a slightly different case as the continent’s flagship Euroleague is already a semi-closed competition — a design that has faced significant blowback since its launch around the turn of the century. But NBA critics are sounding the alarm as crunch talks intensify about the potential launch in 12 proposed cities including Rome, Berlin and Madrid. Senior officials from the International Basketball Federation (FIBA) met with Micallef and key EU sports figures in Brussels earlier this month, where they pressed the case that the new league — with its semi-closed structure but pathway to Europe for clubs that perform well in their domestic leagues — would be a European success story. “Current developments in European basketball highlight long-standing concerns around closed league models,” Micallef said after the meeting, in remarks that may be interpreted as a subtle warning about the American sports model. “They also invite reflection on the growing role of investment in sport, recognising that such investment can be welcome and beneficial provided it respects sound governance principles and remains aligned with Europe’s sporting values, traditions, and structures.” He added: “While breakaway competitions usually promise growth and stability, restricting open competition comes at the expense of national leagues and the wider sporting pyramid: a lesson other sports should consider carefully.” A previous attempt to set up a semi-closed American-style football league in Europe — the ill-fated Super League bid by a group of 12 leading clubs in 2021 — hit a wall of political and public resistance. | Erica Denhoff/Icon Sportswire via Getty Images Two industry officials told POLITICO that Spain’s La Liga — the domestic football league — held a meeting with the NBA to emphasize that the format presented is contrary to the European sports model and that, if implemented, it would be met with staunch opposition from EU institutions and other sporting organizations from across Europe.  NBA officials have been approaching major European football and multi-sports club owners over the past year about joining the basketball project, according to one executive with direct knowledge of negotiations. NBA Commissioner Adam Silver and his deputy Mark Tatum have been talking regularly to Paris Saint-Germain owner Nasser al-Khelaifi, a powerful sports leader from Doha, to try and convince Qatar Sports Investments to own a new franchise in Paris — as part of the PSG group of sports clubs. The American sports bosses have also conducted talks with Barcelona and Real Madrid, the executive said. “Our conversations with various stakeholders in Europe have reinforced our belief that an enormous opportunity exists around the creation of a new league on the continent,” Silver said in a statement. “Together with FIBA, we look forward to engaging prospective clubs and ownership groups that share our vision for the game’s potential in Europe.” In an announcement Monday that the two parties were pressing ahead with the European expansion, FIBA Secretary-General Andreas Zagklis said: “The format of the league respects European sport model principles by offering any ambitious club in the continent a fair pathway to the top. The project is conceived in a way that will improve the sustainability of the entire European basketball ecosystem, including players, clubs, leagues and national federations, by generating a knock-on effect that will strongly benefit basketball fans throughout Europe.” Keen to assuage EU regulatory concerns, the NBA and FIBA added that they plan to dedicate financial support and resources to development throughout Europe’s basketball ecosystem. NO DOMINATION The announcement by the NBA and FIBA of some “permanent spots” in the league is central to the looming resistance in Brussels, which is also skeptical about the economic benefits for Europe. “What about the governance and economic value?” said Bogdan Zdrojewski, an MEP from the conservative European People’s Party group in the European Parliament. “It seems that with the NBA Europe these risk being siphoned out of Europe, leading to a lack of accountability on governance and a staggeringly high loss of economic value if we look at how the economic return — TV rights, sponsorships — generated in Europe will be systematically funneled to U.S.-based holding entities.” Zdrojewski added, “We need to look carefully at how the economic model is likely to lead to a corporate shift with traditional clubs being excluded in favor of global investment funds and state-backed clubs, who will be the only ones able to afford the prohibitive costs like the estimated $500 million to $1 billion founding franchise fees.”  At a meeting of EU sports ministers in Brussels last month, several countries — including Italy, France and Slovenia — spoke out against the NBA’s plans. Lithuania’s President Gitanas Nausėda also recently urged “basketball organizations on both sides of the Atlantic to cooperate, not compete, to take into account and appreciate the deep traditions of European basketball, and not to forget that values come before commercial interests.” Those who have built up European basketball in its current form agree.  “European basketball is built on history, identity and community. Fans here are not a market to be conquered; they are the people who have sustained clubs for decades, across generations,” said Paulius Motiejunas, CEO of the existing top competition Euroleague Basketball. “Any new project should start by respecting that and by strengthening the entire pyramid: elite competition, domestic leagues, and grassroots.” But, he added, collaboration is possible “if the goal is genuinely to grow basketball in Europe.” His terms, he said, were simple: “It has to be a partnership, not a takeover or, as they have mentioned, domination.”

WHO’S AFRAID OF AI?  The EU wants to regulate, while the U.S. government is letting companies run free. What’s behind the divergent approaches goes back a century. By CALDER MCHUGH Illustrations by Nicolás Ortega for POLITICO A young American student gets a text from an AI agent: “stanford just sent an email asking where you wanna study abroad.” After asking “uhhh where should i go” back to the app and deciding on Paris, he spends the semester at first confused by the European capital and then in love, as he meets a French girl and goes to picnics and movies, all with the help of his trusty AI friend. As the semester draws to a close, he asks for help: “can you check me into my flight home?” The AI agent replies: “wait no. why would you wanna go back man” to which the young man responds, “??” The AI says, “stay in Paris.” And it’s decided: He looks up from his phone and puts his arm around his French girlfriend.   The back and forth is cut into a 2 minute, 37 second ad for Poke.com, an AI application that serves as something between a personal assistant and a wise friend, built by the startup Interaction. But ironically, even as it sells the dream of Americans heading to Europe, the company itself was formed when the opposite happened: Interaction is run out of California by German transplants.   The European-led American company is an example of a problem that has perplexed policymakers and tech advocates in Europe: Even though the continent can generate the ideas and talent needed to build new AI apps, it rarely becomes the place where those ideas scale. “Wherever you are in the world — Europe or Asia or wherever — everyone just wants to come to the Bay Area, as long as you’re in AI,” says Marvin von Hagen, one of the co-founders of Interaction. The data bear out von Hagen’s assertion. According to a report from the venture firm Accel,  80 percent of the money invested in generative AI in the U.S., Europe and Israel in 2023 and 2024 went to American firms. In 2024, the U.S. produced 40 “notable AI models,” compared to 15 in China and just three in Europe, according to the 2025 Artificial Intelligence Index Report from Stanford University. Eleven percent of all U.S. tech companies have European founders, and hundreds of promising companies begun in Europe — many concerned directly with AI — have moved to the United States.   “People that want to be part of this AI revolution come here [to the U.S.],” said Florian Juengermann, another German ex-pat who is the co-founder of Listen Labs, an AI company for customer research. “I’m a little bit sad, actually, for Germany.”   Tech founders working on AI companies head to the United States for all kinds of reasons, some of which are self-reinforcing: Silicon Valley is full of AI companies, which makes it easier to build an AI company there. There are more venture funds in the U.S., and they are more interested in investing in unknown products. But there’s another big reason, according to many of the founders themselves and AI advocates in Europe: Tech types are often deeply suspicious of regulation — and Europe certainly has plenty of it, particularly when it comes to AI.  In recent months, tech companies headquartered in Europe, as well as some national governments and the European Commission itself, have sought to lessen the regulatory burden on AI companies by delaying key parts of the implementation of legislation or advocating for the EU to reassess its entire framework. But the differences between Europe and the United States when it comes to AI regulation aren’t so easy to fix; they’re rooted in deep cultural differences that have informed how the tech industries have developed on both continents.   Scholars and members of the industry alike say that changing this culture is crucial for Europe to start playing catch-up, both when it comes to keeping more AI professionals on the continent and encouraging those who do stay to be more entrepreneurial.  “Today, European countries like Germany still retain exceptional talent,” said Robert Windesheim, a German investor at the San Francisco-based Founders Fund, “but often lack the cultural atmosphere that enables this talent to channel their energy into creating new companies.”  PRECEDENT The European Union has for decades been more committed to regulation across industries than the United States. And for as long as Europe has chosen a somewhat slower, somewhat safer growth model, there have been young, ambitious people who get frustrated by bureaucratic guardrails.    But exactly why the EU has such a different understanding of the role of the state — in particular as it relates to AI — is a broader question that goes to the heart of the historical and cultural differences across the Atlantic.   A lot of it has to do with privacy. “The first thing that many people in Europe think about when they think about technology is ‘They will spy on us,’ or ‘This technology will be used in a negative way,’” said Juengermann. “For example, in Germany, people will not give out their phone number. They protect their phone number. It’s like people [in the U.S.] with their Social Security number.”   According to Anu Bradford, a professor at Columbia University who studies the European Union’s digital regulatory state — who herself is largely in favor of Europe’s regulations on AI — some of this can be traced almost a century back. “You need to think about historical reasons and the Second World War, and how the Nazis got the information to identify the Jews — they were infringing on their right to privacy,” she said. “You think about the surveillance by the Stasi in East Germany. Europeans know what it’s like when you don’t have privacy … they’re hypersensitive to that for cultural reasons.”  Dean Ball, who was the primary author of the Trump administration’s AI Action Plan, has little agreement with Bradford about regulation. But he also traced the cultural differences between the two places to the mid-20th century. The European Union has “preserved the status quo in amber,” Ball believes, operating with a 20th century mindset to solve 21st century problems.    Windesheim, a European by birth himself, also traced fears of safety to crises from the last century. “Europe’s 20th-century catastrophes left a lasting, and rightfully cautionary, mindset. Downside protection and safety became paramount,” he said. In large part, he believes, Europeans have simply adopted and codified into law a different risk assessment around tech than the American government.   Then there’s Silicon Valley, which itself has a culture that’s out of step with much of the American and European populace — and that has shaped the rest of America’s posture on tech. That culture has long been guided by a libertarian ethos and unwavering faith in technological advancement, not the forces that might inhibit it. “Despite the central role played by public intervention in developing hypermedia, the Californian ideologues preach an anti-statist gospel of hi-tech libertarianism: a bizarre mishmash of hippie anarchism and economic liberalism beefed up with lots of technological determinism,” two media theorists wrote in a seminal essay, The Californian Ideology, for Whole Earth Catalog in the mid-90s.  One of the most popular concepts flowing through Bay Area circles today is the idea of accelerationism. This philosophy includes different strains of thought: all the way from believing (and hoping) that unregulated AI development will lead to a techno-utopia where the machines solve disease to believing (and hoping) that AI will destroy democracy and usher in a world where a vanishingly small number of tech overlords rule the world. These different outlooks contributed to vastly different regulatory cultures around technology in the U.S. and EU through the 20th and 21st centuries. The EU’s General Data Protection Regulation, a comprehensive privacy law implemented in 2018, enshrines a right to privacy that doesn’t exist in the U.S. — and restricts tech companies’ ability to collect data and monetize it, which has had massive ramifications for tech companies’ ability to grow in Europe.   “There’s a lot of hubris, a lot of arrogance, and [Europe] really has this mindset that they need to be the world’s regulator, but they do it before the technology is actually developed,” said Michael Jackson, an American tech investor who lives and works in Paris. That’s compared to the U.S., where according to him, the government steps in with more targeted regulation once it understands the needs of the marketplace.  AI threw these differences into starker relief than ever. AI presented greater challenges to privacy and more opportunities for surveillance, and the consequences are harder to predict than almost any other innovation that had come before it, with the possible exception of the internet itself — a nightmare for the risk-averse.   Europe has taken a notably more muscular regulatory approach. The Artificial Intelligence Act — which entered into force in the EU on August 1st, 2024, is Europe’s most comprehensive attempt at reining in AI companies that are not acting in the best interest of the public. Largely, the legislation is about harm reduction. It creates categories of risk for AI applications — from “minimal” to “unacceptable” risk (the latter applications are banned) — and forces most AI companies to be more transparent about how they work.  At the same time, after some halting efforts to regulate AI during the Joe Biden administration, the U.S. under President Donald Trump has thrown regulation to the side. In July, the Trump administration released the AI Action Plan, a series of policy preferences that pledged to “remove red tape and onerous regulation” of AI development. As the EU regulates more, America is doing so less. And as the gap has widened, so has the number of founders in each place.  There have also been new reasons why Europe needs to think about regulation. “[American success] has amplified the need for Europe to protect itself, because you find yourself increasingly more dependent on a technology you don’t own and you don’t control,” said Mariarosaria Taddeo, an Italian who is now a professor of digital ethics and defense technologies at the Oxford Internet Institute in the UK.   The EU has to think more about stimulating tech development, she said, because it is not sure what the ultimate goals of American tech giants are — and how much it might need to fight against a private corporation that doesn’t have the best interests of Europe’s citizens in mind.   “[Europe] is in a weak position, because most of the developers [in the world] are Americans,” said Bradford. “It’s becoming increasingly hard, if the EU is trying to police the world on its own and if the Americans are not regulating themselves.”  BEYOND THE NARRATIVE Advocates for the European framework argue that far from stifling innovation, it simply makes this rapidly emerging technology safer for users and founders alike. In fact, they chafe at the very notion that regulation and innovation are antithetical.   “I don’t want there to be this perception that you need to choose the American hands-off model if you want to have innovation, and the European model will be somehow fundamentally inconsistent with innovation,” said Bradford. “It’s a very easy narrative to say, ‘Well, because they regulate so much, there’s no innovation.’ That’s not why Europeans are not leading in AI innovation.”  Bradford cited the difficulty of having 27 jurisdictions without a single, united marketplace, as one of the major reasons that AI development in the EU has not been simple — an idea that many anti-regulation experts and tech founders also agreed with.   Beyond that, there’s just more investment available in America right now. Venture capitalists are pouring money into U.S.-based tech companies and are often more reticent to do so for those that are elsewhere — between 2013 and 2022, EU-headquartered firms received $1.4 trillion less in venture funding than those based in the U.S.   Europe is also far from the only place where the regulatory state is on the rise.   In fact, although Washington may not be moving to put guardrails on AI, the state of California is stepping into the breach and implementing several AI guidelines that do a similar job. One reason is that Americans are also fearful of unregulated AI — according to a Gallup poll conducted in April and May of 2025, 80 percent of Americans believe in maintaining rules for AI safety and data security, even if it means developing AI capabilities at a slower rate.   “My view is that Americans and Europeans are closely aligned on AI governance. If you look at the polling data, if you look at the concerns about copyright, concerns about privacy, concerns about labor displacement, you see it in equal measure in both regions,” said Marc Rotenberg, the president and founder of the Center for AI and Digital Policy in Washington. “The White House has taken a position on AI regulation that’s out of step with where most Americans are, with where most state legislators are, and even with where they were previously.”  For Euro-optimists, there are some signs that while the governance might not be perfect, regulation is not stifling innovation, and Europe is starting to find its footing in the realm of AI development.  “AI is not going to disappear. It’s not going to be gone in 10 years … You don’t need to be first in AI. You need to be resilient and robust and trustworthy in AI,” said Taddeo.  Even as Europe takes a more robust regulatory posture, they are also trying to get in on the action. In November, the European Commission mobilized €200 billion for AI investment and French President Emmanuel Macron announced a commitment to sinking €109 billion in private investment into the sector. In the Nordic countries in particular, government investment has led to innovation and successful, growing companies. So far, though, no European government has taken direct aim at the regulatory state.   But as the continent tries its own approach to building companies that’s wildly different from Silicon Valley’s, the question is whether they’re too late to matter — whether the good parts of the party are already over.   “They were too late five years ago, and they’re absolutely too late now,” said Ball. 

Europe prides itself on being a world leader in animal protection, with legal frameworks requiring member states to pay regard to animal welfare standards when designing and implementing policies. However, under REACH — Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH) — the EU’s cornerstone regulation on chemical safety, hundreds of thousands of animals are subjected to painful tests every year, despite the legal requirement that animal testing should be used only as a ‘last resort’. With REACH’s first major revamp in almost 20 years forthcoming, lawmakers now face a once-in-a-generation opportunity to drive a genuine transformation of chemical regulation.  When REACH was introduced nearly a quarter of a century ago, it outlined a bold vision to protect people and the environment from dangerous chemicals, while simultaneously driving a transition toward modern, animal-free testing approaches. In practice, however, companies are still required to generate extensive toxicity data to bring both new chemicals and chemicals with long histories of safe use onto the market. This has resulted in a flood of animal tests that could too often be dispensed, especially when animal-free methods are just as protective (if not more) of human health and the environment.  > Hundreds of thousands of animals are subjected to painful tests every year, > despite the legal requirement that animal testing should be used only as a > ‘last resort’. Despite the last resort requirement, some of the cruelest tests in the books are still expressly required under REACH. For example, ‘lethal dose’ animal tests were developed back in 1927 — the same year as the first solo transatlantic flight — and remain part of the toolbox when regulators demand ‘acute toxicity’ data, despite the availability of animal-free methods. Yet while the aviation industry has advanced significantly over the last century, chemical safety regulations remain stuck in the past.   Today’s science offers fully viable replacement approaches for evaluating oral, skin and fish lethality to irritation, sensitization, aquatic bioconcentration and more. It is time for the European Commission and member states to urgently revise REACH information requirements to align with the proven capabilities of animal-free science.   But this is only the first step. A 2023 review projected that animal testing under REACH will rise in the coming years in the absence of significant reform. With the forthcoming revision of the REACH legal text, lawmakers face a choice: lock Europe into decades of archaic testing requirements or finally bring chemical safety into the 21st century by removing regulatory obstacles that slow the adoption of advanced animal-free science.   If REACH continues to treat animal testing as the default option, it risks eroding its credibility and the values it claims to uphold. However, animal-free science won’t be achieved by stitching together one-for-one replacements for legacy animal tests. A truly modern, European relevant chemicals framework demands deeper shifts in how we think, generate evidence and make safety decisions. Only by embracing next-generation assessment paradigms that leverage both exposure science and innovative approaches to the evaluation of a chemical’s biological activity can we unlock the full power of state-of the-art non-animal approaches and leave the old toolbox behind.  > With the forthcoming revision of the REACH legal text, lawmakers face a > choice: lock Europe into decades of archaic testing requirements or finally > bring chemical safety into the 21st century. The recent endorsement of One Substance, One Assessment regulations aims to drive collaboration across the sector while reducing duplicate testing on animals, helping to ensure transparency and improve data sharing. This is a step in the right direction, and provides the framework to help industry, regulators and other interest-holders to work together and chart a new path forward for chemical safety.   The EU has already demonstrated in the cosmetics sector that phasing out animal testing is not only possible but can spark innovation and build public trust. In 2021, the European Parliament urged the Commission to develop an EU plan to replace animal testing with modern scientific innovation. But momentum has since stalled. In the meantime, more than 1.2 million citizens have backed a European Citizens’ Initiative calling for chemical safety laws that protect people and the environment without adding new animal testing requirements; a clear indication that both science and society are eager for change.   > The EU has already demonstrated in the cosmetics sector that phasing out > animal testing is not only possible but can spark innovation and build public > trust. Jay Ingram, managing director, chemicals, Humane World for Animals (founding member of AFSA Collaboration) states: “Citizens are rightfully concerned about the safety of chemicals that they are exposed to on a daily basis, and are equally invested in phasing out animal testing. Trust and credibility must be built in the systems, structures, and people that are in place to achieve both of those goals.”  The REACH revision can both strengthen health and environmental safeguards while delivering a meaningful, measurable reduction in animal use year on year.  Policymakers need not choose between keeping Europe safe and embracing kinder science; they can and should take advantage of the upcoming REACH revision as an opportunity to do both.  -------------------------------------------------------------------------------- Disclaimer POLITICAL ADVERTISEMENT * The sponsor is Humane World for Animals * The ultimate controlling entity is Humane World for Animals More information here.

Europe’s chemical industry has reached a breaking point. The warning lights are no longer blinking — they are blazing. Unless Europe changes course immediately, we risk watching an entire industrial backbone, with the countless jobs it supports, slowly hollow out before our eyes. Consider the energy situation: this year European gas prices have stood at 2.9 times higher than in the United States. What began as a temporary shock is now a structural disadvantage. High energy costs are becoming Europe’s new normal, with no sign of relief. This is not sustainable for an energy-intensive sector that competes globally every day. Without effective infrastructure and targeted energy-cost relief — including direct support, tax credits and compensation for indirect costs from the EU Emissions Trading System (ETS) — we are effectively asking European companies and their workers to compete with their hands tied behind their backs. > Unless Europe changes course immediately, we risk watching an entire > industrial backbone, with the countless jobs it supports, slowly hollow out > before our eyes. The impact is already visible. This year, EU27 chemical production fell by a further 2.5 percent, and the sector is now operating 9.5 percent below pre-crisis capacity. These are not just numbers, they are factories scaling down, investments postponed and skilled workers leaving sites. This is what industrial decline looks like in real time. We are losing track of the number of closures and job losses across Europe, and this is accelerating at an alarming pace. And the world is not standing still. In the first eight months of 2025, EU27 chemicals exports dropped by €3.5 billion, while imports rose by €3.2 billion. The volume trends mirror this: exports are down, imports are up. Our trade surplus shrank to €25 billion, losing €6.6 billion in just one year. Meanwhile, global distortions are intensifying. Imports, especially from China, continue to increase, and new tariff policies from the United States are likely to divert even more products toward Europe, while making EU exports less competitive. Yet again, in 2025, most EU trade defense cases involved chemical products. In this challenging environment, EU trade policy needs to step up: we need fast, decisive action against unfair practices to protect European production against international trade distortions. And we need more free trade agreements to access growth market and secure input materials. “Open but not naïve” must become more than a slogan. It must shape policy. > Our producers comply with the strictest safety and environmental standards in > the world. Yet resource-constrained authorities cannot ensure that imported > products meet those same standards. Europe is also struggling to enforce its own rules at the borders and online. Our producers comply with the strictest safety and environmental standards in the world. Yet resource-constrained authorities cannot ensure that imported products meet those same standards. This weak enforcement undermines competitiveness and safety, while allowing products that would fail EU scrutiny to enter the single market unchecked. If Europe wants global leadership on climate, biodiversity and international chemicals management, credibility starts at home. Regulatory uncertainty adds to the pressure. The Chemical Industry Action Plan recognizes what industry has long stressed: clarity, coherence and predictability are essential for investment. Clear, harmonized rules are not a luxury — they are prerequisites for maintaining any industrial presence in Europe. This is where REACH must be seen for what it is: the world’s most comprehensive piece of legislation governing chemicals. Yet the real issues lie in implementation. We therefore call on policymakers to focus on smarter, more efficient implementation without reopening the legal text. Industry is facing too many headwinds already. Simplification can be achieved without weakening standards, but this requires a clear political choice. We call on European policymakers to restore the investment and profitability of our industry for Europe. Only then will the transition to climate neutrality, circularity, and safe and sustainable chemicals be possible, while keeping our industrial base in Europe. > Our industry is an enabler of the transition to a climate-neutral and circular > future, but we need support for technologies that will define that future. In this context, the ETS must urgently evolve. With enabling conditions still missing, like a market for low-carbon products, energy and carbon infrastructures, access to cost-competitive low-carbon energy sources, ETS costs risk incentivizing closures rather than investment in decarbonization. This may reduce emissions inside the EU, but it does not decarbonize European consumption because production shifts abroad. This is what is known as carbon leakage, and this is not how EU climate policy intends to reach climate neutrality. The system needs urgent repair to avoid serious consequences for Europe’s industrial fabric and strategic autonomy, with no climate benefit. These shortcomings must be addressed well before 2030, including a way to neutralize ETS costs while industry works toward decarbonization. Our industry is an enabler of the transition to a climate-neutral and circular future, but we need support for technologies that will define that future. Europe must ensure that chemical recycling, carbon capture and utilization, and bio-based feedstocks are not only invented here, but also fully scaled here. Complex permitting, fragmented rules and insufficient funding are slowing us down while other regions race ahead. Decarbonization cannot be built on imported technology — it must be built on a strong EU industrial presence. Critically, we must stimulate markets for sustainable products that come with an unavoidable ‘green premium’. If Europe wants low-carbon and circular materials, then fiscal, financial and regulatory policy recipes must support their uptake — with minimum recycled or bio-based content, new value chain mobilizing schemes and the right dose of ‘European preference’. If we create these markets but fail to ensure that European producers capture a fair share, we will simply create new opportunities for imports rather than European jobs. > If Europe wants a strong, innovative resilient chemical industry in 2030 and > beyond, the decisions must be made today. The window is closing fast. The Critical Chemicals Alliance offers a path forward. Its primary goal will be to tackle key issues facing the chemical sector, such as risks of closures and trade challenges, and to support modernization and investments in critical productions. It will ultimately enable the chemical industry to remain resilient in the face of geopolitical threats, reinforcing Europe’s strategic autonomy. But let us be honest: time is no longer on our side. Europe’s chemical industry is the foundation of countless supply chains — from clean energy to semiconductors, from health to mobility. If we allow this foundation to erode, every other strategic ambition becomes more fragile. If you weren’t already alarmed — you should be. This is a wake-up call. Not for tomorrow, for now. Energy support, enforceable rules, smart regulation, strategic trade policies and demand-driven sustainability are not optional. They are the conditions for survival. If Europe wants a strong, innovative resilient chemical industry in 2030 and beyond, the decisions must be made today. The window is closing fast. -------------------------------------------------------------------------------- Disclaimer POLITICAL ADVERTISEMENT * The sponsor is CEFIC- The European Chemical Industry Council  * The ultimate controlling entity is CEFIC- The European Chemical Industry Council  More information here.