good morning. US President Donald Trump publicly attacked Ukrainian Bishop Voldimi Zelenki for refusing to admit Russia’s illegal occupation of Crimea. As we report this morning, the explosion exacerbated the existential dilemma facing European capitals. It adheres to Kiev’s long-standing commitments, as well as how to end the war with Washington and support efforts to stay on good terms.
Today, our energy correspondent reports on Ursula von der Leyen’s multipurpose, highly energy travel to London, while Iberian reporters bring news of Portugal’s decision to use more flexible fiscal rules for defence spending.
warm up
While European Commission President Ursula von der Leyen travels to London today to ostensibly present her views on energy security, Alice Hancock writes that a related meeting with Ir Kiel’s priority could prove more impactful.
Context: The International Energy Agency’s Energy Summit has been around for almost a year, as energy security is becoming increasingly crucial in relations between Russia, the US and the EU. The event also comes a month before the first EU-UK leader summit since Brexit.
The British Prime Minister and von der Leyen are expected to use bilateral conversations today to finalise plans for a new post-Brexit strategic alliance as the UK and the EU approach deals on defense and security agreements and fishing rights, as agreed by leaders at the May 19 summit. It could pave the way for negotiations on broader economic transactions, officials said.
One EU official said at today’s bilateral meeting, which is scheduled to “start in Ukraine,” “many issues” will be discussed by the two leaders.
Energy is likely to be raised as well, and North Sea states such as Belgium and the Netherlands are particularly keen on the progress of the region at the May summit. Companies on both sides of the channel have complained that post-Brexit energy trading arrangements are keeping new projects up and increasing consumer costs.
At the IEA event, Von Der Leyen and Starmer each gave speeches, with the committee president expecting the challenges of electricity pricing and the need for cooperation in the North Sea.
She also nodded to transatlantic relations and said she “has not forgot” how the US intervened to supply gas as Russia cut the flow of the pipeline following a full-scale invasion of Ukraine.
“These energy partnerships, including imports of LNG from the US, are strategically important to the European Union,” she says.
US state secretaries will not be present, but US Department of Energy and State Department officials will be present.
Today’s Chart: Interference
Executive Overreach is a recent theme. The most recent to join the interfering crowd is Italian Prime Minister Giorgia Meloni. He called the “golden power” rule to prevent a 14 billion euro bid for lender Unicredit’s smaller rival BPM, Lex writes.
Finance First Movers
Portugal has become the first country to ask the European Commission to activate the so-called escape clause as pressure is placed on NATO Laguard to meet 2% of Alliance’s GDP targets.
Context: As part of a measure aimed at promoting defence spending, Brussels has no threat of a disciplinary stage where the government will rise above 3% of GDP.
Portugal spent just 1.55% of its GDP on defense last year. Last month, Finance Minister Joachim Miranda Salment told the Financial Times that defence spending should not threaten financial surplus or add debt to it.
Lisbon’s announcement that it will apply to a financial loophole has spent around 10.5 billion euros while not cutting the welfare budget, Spain’s Prime Minister Pedro Sanchez vows to reach a 2% target this year. Currently, NATO’s lowest defensive spending is just 1.3%.
Another defensive spending delays, Italy said it would not ask Brussels for a budget escape clause.
At the June summit, NATO leaders are expected to raise their spending targets to at least 3% of GDP, but Trump has proposed a higher target of 5%.
Portugal’s central right government said the decision was agreed with the opposition Socialist Party. The country will hold a general election next month.
What to see today
A summit on the future of energy security in London.
NATO Secretary General Mark Latte travels to Washington for a two-day visit.
The G20 Finance Minister will be held in Washington on the sidelines of the IMF/World Bank Spring Meeting.
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