Brussels Edition: A bulwark against isolationism

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

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Welcome to the Brussels Edition, Bloomberg's daily briefing on what matters most in the heart of the European Union. As President Donald Trump launched his opening salvo against multilateralism, Europeans rushed to defend international cooperation from climate to health. Commission President Ursula von der Leyen used a speech in Davos to warn of a "new era of harsh geostrategic competition" — a possible reference to Trump's return — while pledging to deepen cooperation with the US and China. Against the backdrop of US isolationism, the EU will stay engaged globally, including by remaining in the global climate accord and corralling international partners to keep the World Health Organization well-financed, a spokesperson said. Meanwhile, some officials from EU nations including Spanish Economy Minister Carlos Cuerpo said they may resort to the OECD's multilateral framework in response to Trump's threat to retaliate against countries taxing American multinational companies.  — Jorge Valero

What's Happening

Tech Frictions | The bloc will raise concerns with Washington over a decision to restrict the export of AI chips to Poland and some other eastern member states, we're told. The Biden Administration introduced restrictions before leaving office to ensure the alignment of third countries with American standards on AI.  Electrifying | The EU is working on a proposal to incentivize the purchase of electric vehicles, German Chancellor Olaf Scholz said in Davos yesterday. Europe's car industry is sagging partly because of low demand for EVs as the new Trump administration is considering eliminating subsidies for cleaner cars.  Smaller Burden | France is preparing a set of recommendations to be ready as soon as this week to simplify EU sustainability requirements, we're told. The step follows Germany's proposals as the bloc is discussing ideas to cut red tape and ease regulation to spur European competitiveness. Softening Rules | The EU is likely to scale back its highly contested ESG reporting requirements, as France prepares to unveil a formal proposal seeking to limit the scope of the regulatory framework.

Around Europe

Ailing Axis | The embattled leaders of France and Germany, Olaf Scholz and Emmanuel Macron, will meet today in Paris, where they're expected to call for a quick response should Trump follow through on threats to impose tariffs on European exports, we're told.  Still Ahead | Romania's far-right candidate, who won the first round of a presidential election that was later canceled, remains the frontrunner for the re-run of the vote in May, according to a poll. Calin Georgescu, who shocked the political establishment last year, however would face a tight race in a runoff against the candidate supported by the ruling parties, Crin Antonescu.  Friendly Advice | Ukrainian President Volodymyr Zelenskiy called on Europe to become more self-reliant, including in the areas of military production and technology. The algorithms of social media giants such as TikTok are already more powerful than some of the continent's governments, he said. Read more of our Davos coverage. Fixing Spending | French Finance Minister Eric Lombard said he secured support from European partners for his deficit-reduction path, in a boost for the government planning to bring deficit below the EU's target of 3% of economic output by 2029, although at a more gradual pace compared with earlier proposals.  Harder Sell | Victor Pinchuk has given away a fortune advocating for Ukraine and has long known Trump. That makes him the right conduit for Kyiv's interests as the global elite gather in Davos. His Ukraine House has become a fixture at the World Economic Forum and was the place to be to watch Trump's inauguration this week. But trying to get the rich and influential to open their wallets for his homeland has become a harder sell.

Chart of the Day

European car sales were almost flat last year, growing by 0.9% from a year earlier due to the persistent inflation, higher borrowing costs and apathy toward electric models, the European Automobile Manufacturers' Association said. Europe's automakers are braced for tough months ahead, with stricter EU emissions targets in 2025 forcing them to sell more electric vehicles despite the drop in demand.

Today's Agenda

All times CET 9 a.m. Commission President Ursula von der Leyen, Council President Antonio Costa participate in European Parliament debate on conclusions of December's EU summit 9 a.m. EU Economy Commissioner Valdis Dombrovskis participates in panel about Russia in Davos 9:10 a.m. EU Foreign Affairs Chief Kaja Kallas holds speech at EDA Annual Conference "New horizons in EU defence" 10 a.m. Polish Prime Minister Donald Tusk addresses European Parliament EU Executive Vice President Teresa Ribera delivers a keynote speech in the event "Unlocking Impact at COP 30" at World Economic Forum in Davos, Switzerland

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