Shaping the future of the EU – key outcomes of the 2025 State of the Union

The State of the Union included a lot of political statements that sound extremely promising and resounding. Time will tell how their implementation will turn out. Nevertheless, there were a few key points worth mentioning. In her speech, the President of the European Commission called for unity between member states and within institutions to manage its own defence and security, controls technologies and reduce dependencies from externals actors.

Security and Geopolitics

Ursula von der Leyen began the geopolitical part of her speech with war in Ukraine, urged for a just and lasting peace. She declared to host the summit of the International Coalition for the return of abducted Ukrainian children. Besides the declaration of constant support, von der Leyen announced the Reparations Loan mechanism using immobilised Russian assets, Qualitative Military Edge programme to enforce investments in capabilities of the Ukrainian armed forces and Drone Alliance with Kyiv. In terms of actions towards Russian it was emphasised that Brussels is working on its 19th package against Russia and take strong actions towards shadow fleet and third countries. Besides it was mentioned about the significant value ofReadiness 2030 with EUR 800 billion investment potential, SAFE programme and support for the Eastern Flank.

Given the European Union’s previously ambiguous position on Israel’s actions in the Gaza Strip, the proposed measures towards Tel Aviv were unexpected. According to announcement, European Commission will submit Council the suspension of EU bilateral support to Israel (except civil society & Yad Vashem) and partially EU–Israel trade agreement. What is more, EC will advocate for sanctions on extremist Israeli ministers and violent settlers and creation of a Palestine Donor Group for Gaza reconstruction. Nevertheless, in the context of the pro-Israel stance represented by Germany and Hungary, it will be difficult to go beyond the rhetoric of these proposals.

Competitiveness and Economic Independence

The first pillar of enhancing European economic competitiveness focused on reducing strategic dependencies. According to the scope of State of the Union it can be achieved by increased investments in digital and clean tech thanks to Competitiveness Fund and a doubled Horizon Europe (EU research and innovation programme). The second pillar is aimed at cutting EUR 8 billion a year of bureaucratic costs for European companies. Von der Leyen also referred to implementation of digital Euro and Scaleup Europe Fund to help major investments in young, fast-growing companies in critical tech areas.

What is more, the statement raised the issue of massively investing in European AI Gigafactories to develop, train, and deploy their next-generation AI models. After that politician mentioned the European AI & Tech Declaration made by the largest European tech champions to show their commitment to invest in Europe’s tech sovereignty.

Green Transition & Social Agenda

In terms of energy transition, it was pointed out that EU is on good path track for 2030 climate targets – reduction of greenhouse gas (GHG) emissions by at least 55% compared to 1990 levels. In terms of Clean Industrial Deal – Brussels will launch a Battery Booster package to put EUR 1.8 billion up for equity to boost production in Europe as batteries are a key enabler of other clean tech – especially electric vehicles.

Taking into consideration the social problems especially increasing costs of living, European Commission will propose Affordable Housing Plan to address the growing housing crisis.

The topic of defending democratic values, the rule of law, and freedom of speech could not be overlooked as they are perceived as a core of European values. In this context, mention was made of the New European Democracy Shield to detect disinformation and manipulation the European Center for Democratic Resilience and Media Resilience Program to protect independent journalism.

Global Role of European Union & Migration

Ursula von der Leyen strongly defeated the EU-US trade deal describing it as best available deal. Emphasising the importance of maintain strong relations between Washington and Brussels she called for the need for diversification to trade with the world – Mercosur, Mexico, India and CPTPP (Comprehensive and Progressive Agreement for Trans-Pacific Partnership).

During the von der Leyen speech migration topic cannot be dismissed. European stance towards this challenge was characterized as commitment to humane but firm migration system. President of European Commission called for quick adoption of the Common European System for Returns - for returning non-EU nationals who are staying illegally in the EU. What is more focus on dismantling smuggling networks, such as sanctions on people involved in these actions.

Need for Institutional Reform

At the end of her speech, Ursula von der Leyen mentioned the need for institutional reforms, such as qualified majority voting in certain areas, including foreign policy, the renewal of the framework agreement between the Commission and Parliament, and granting the European Parliament the right of initiative.

The State of the Union address touched upon many different topics – from geopolitics and security, through competitiveness, technology, and social policy, to energy transition and issues related to the need for institutional reforms. Each of these sectors faces significant challenges, raising the broader question of the European Union’s trajectory – whether it will maintain its current level of integration or advance towards deeper federalization. In this context, it is important to note the growing support for right-wing parties across several Member States, many of which are critical of further European integration or openly urosceptic. Their rising influence will increasingly test European institutions, making it essential for the EU to prove its effectiveness through concrete measures not only words and statements.