Brussels Edition: Strategic Thinking

Brussels Edition
Bloomberg

Welcome to the Brussels Edition, Bloomberg's daily briefing on what matters most in the heart of the European Union.

"Autonomy and resilience" are new buzzwords in Brussels, after the pandemic exposed how the EU was lacking in both. The bloc's leaders will vow to become more independent and robust by reducing "strategic dependencies" when they meet in Brussels later this month, according to an early draft of their conclusions that we've seen. Today, the European Commission will identify the major trends that stand to shape the world of the future in its first ever "foresight" report. The trouble is that policy makers are usually consumed by the present. There was no shortage of big reports about the prospect of a pandemic, and yet the virus found the EU woefully unprepared. Thinking strategically is one thing, acting accordingly is an entirely different challenge.

— Alexander Weber and Nikos Chrysoloras

What's Happening

Trade Czar | Valdis Dombrovskis, the Commission's new trade chief as part of a leadership reshuffle, drew a hard line on a dispute with the U.S. over aircraft subsidies. Unless the U.S. removes duties imposed over unlawful subsidies to Airbus, the EU would retaliate with its own set of levies, he said in an interview. But the former Latvian prime minister also said he hopes both sides can strike an accord before things get messy.

Breaking the Law | A U.K. minister conceded the government will break international law, in a bill to be published today, by attempting to re-write the Brexit divorce deal that the prime minister signed with the EU only last year. The bloc's Brexit negotiators, who are in London for another difficult round of talks, are unlikely to be impressed.

Lagarde's Tools | The euro's rally to a two-year high is making European Central Bank policy makers nervous, putting investors on the lookout for some kind of intervention. Such action looks unlikely when the Governing Council sets policy on Thursday, but President Christine Lagarde and her colleagues might decide to start laying the groundwork in case it does need to act. We look at some of their options.

Holiday Nightmares | Abrupt government decisions to impose quarantine requirements for returning travelers don't make things easier for the world's battered travel industry. The small island of Serifos, home of our Brussels bureau chief, was blacklisted by the British government, while travel to Greek epicenters of the pandemic — including Athens and other tourist hotspots — continues to be permitted. Our dispatch highlights the complexity of planning a holiday during the pandemic.

In Case You Missed It

More Debt | Germany plans significant new borrowing next year to fuel the recovery of Europe's largest economy from the fallout of the coronavirus, Finance Minister Olaf Scholz said Tuesday at a Bloomberg online event. The country won't adhere to its infamous debt brake this year or next, and might make more use of borrowing leeway when it does, he said. 

Zloty Strength | Poland's zloty has room to strengthen as the economy recovers from the coronavirus crisis faster than expected, Prime Minister Mateusz Morawiecki said in an interview. While the central bank has repeatedly advocated a weaker currency, Morawiecki said its level is good for the stability of the economy.

Soccer Bet | With the coronavirus's next wave in full swing in Hungary, Prime Minister Viktor Orban is gambling that allowing tens of thousands of spectators to attend a high-profile soccer game later this month won't turbo-charge the pandemic. More than 20,000 fans are scheduled to attend a Sept. 24 match between Bayern Munich and Seville in Budapest. 

Colonial Legacy | After the the death of George Floyd at the hands of police in the U.S. sparked a wave of Black Lives Matter demonstrations across the EU, a colonial-era museum on the outskirts of Brussels has been put back under the spotlight. Here's our QuickTake video explainer on Belgium's Africa museum and the ongoing controversies surrounding it.

Chart of the Day

French economic activity recovered to around 95% of pre-crisis levels in August, but will improve little through the end of the year, national statistics agency Insee said yesterday. While government support for businesses will continue, there is uncertainty about the pandemic and how consumers will spend their savings. 

Today's Agenda

All times CET.

  • 12 p.m. Commission unveils its first ever Strategic Foresight Report
  • Eurofi Financial Forum in Berlin

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