In the EU-Parliament in Strasbourg, EU-Commission President Ursula von der Leyen gave her first State of the Union address (SOTEU) of her second term in office. She outlined the EU's priorities and flagship initiatives for the coming year and announced a number of measures, mainly relating to economic policy, for the 2024-2029 legislative period. Overall, she took a strong geopolitical perspective within the framework of SOTEU, while her view of the social situation within the EU was rather vague.

Competitiveness and the EU Single Market a priority

Von der Leyen announces major investments in digital and clean tech. The plan is to set up a Scaleup Europe Fund for young and fast-growing start-ups in key technology areas such as AI and biotechnology. The aim is a functioning circular economy. In addition, there are plans for a new piece of legislation, the Industrial Accelerator Act, which is intended to contribute to the faster expansion of important sectors and technologies. The introduction of ‘made in Europe’ as a criterion for public contracts is also planned. The Commission President emphasised the importance of the Savings and Investment Union and the need to strengthen the EU's competitiveness.

The Single Market is to be expanded, particularly in the areas of finance, energy and telecommunications. According to von der Leyen, European companies would save €8 billion in bureaucratic costs annually as a result of the omnibuses. The Commission President also defends the trade agreement concluded with the United States in the summer. Von der Leyen and US President Donald Trump agreed, among other, on a 15% tariff on EU industrial products in the US, with simultaneous tariff exemption for US products in the EU. With this agreement, the EU has secured a relative advantage over other countries that still have to pay higher tariffs.

Social policy – a few announcements, little substance

In terms of social policy, von der Leyen is focusing on the rising cost of living, particularly in the areas of food, housing and energy. She describes rising property prices in Europe and the associated housing crisis as a social crisis that threatens European cohesion. That is why there are plans for the first EU Housing Summit, as part of a new European Affordable Housing Plan and a legislative initiative for short-term rentals. In addition, measures are planned to ensure affordable living costs. With regard to employment, von der Leyen has announced a Quality Jobs Act – it remains to be seen exactly what proposal the Commission will put forward. A Quality Jobs Roadmap has been announced so far, and AK has already made proposals for its design. In addition, a European Anti-Poverty Strategy is being developed, which will put a special focus on combating child poverty. The aim of the strategy is to eradicate poverty in Europe by 2050.

Climate & Energy

According to Commission President von der Leyen, the EU is - thanks to the European Green Deal - well on track to achieve its goal of reducing emissions by at least 55% by 2030. She emphasises: ‘We must stay the course on our climate and environmental goals.’ A Battery Booster package and new Energy Highways have been announced to close critical bottlenecks. As stated by von der Leyen, promoting production in Europe is the key factor for clean energy and independence from Russian fossil fuels. The generation of renewable energy production in Europe is to be expanded, with nuclear energy serving as the baseload.  In addition, EU Commission President von der Leyen announced an initiative for small, affordable electric cars to be developed and produced in Europe. This is intended to secure the EU’s competitiveness and meet the growing global demand for electric vehicles.

Digitalisation, enlargement and EU decision-making structures

Von der Leyen also emphasises the importance of free and independent media and the fight against disinformation and information manipulation. For this reason, a ‘European Centre for Democratic Resilience’ and a support programme for independent journalism are to be created. A group of experts is to address the issue of young people and social media and develop possible protection mechanisms for young users. Von der Leyen also reaffirms the accession prospects of Ukraine, Moldova and the Western Balkans. At the end of her speech, she supports the EU-Parliament's right of initiative and emphasises that the EU must move to qualified majorities in some areas, such as foreign policy: ‘It is time to break free from the shackles of unanimity.’

Debating the speech

The speech was followed by fierce criticism of the EU-US trade deal from the leaders of the S&D Group, Patriots for Europe and the European Left. However, both EPP and ECR supported the agreement with the US and Mercosur. The European Trade Union Confederation (ETUC) criticised the fact that Ursula von der Leyen's second term in office has so far been dominated by deregulation proposals and that social policy measures were only announced in the SOTEU. ETUC calls for the rapid implementation of the EU Quality Jobs Act announced by the Commission President. According to ETUC, this package should include various binding legal acts, such as a ‘Just Transition’ directive, subcontracting limits and an EU Directive on the prevention of psychosocial risks at work and burnout.

From AK's perspective, the omnibus initiatives are also viewed extremely critical, especially as they threaten to put pressure on social and environmental standards. The EU's competitiveness must be promoted in a sustainable manner. This means expanding modern, climate-friendly public infrastructure, providing legal and planning security for employees and companies, comprehensive public services and high educational standards. It is also sobering that the social dimension of the EU is increasingly at risk of becoming a sideshow.

Further information:

EU Commission: 2025 State of the Union Address by President von der Leyen
EU Commission: State of the Union 2025
AK EUROPA: New name, old challenges. The EU Savings and Investment Union
AK EUROPA: The new EU Single Market Strategy. What does it mean for businesses and the world of work?
AK EUROPA: EU-US trade relations. An unequal ‘deal’ sets the direction
AK EUROPA: Sustainability Omnibus. Simplification of the Corporate Sustainability Due Diligence Directive or undermining human rights obligations?
AK EUROPA: A Compass for the EU's Competitiveness
EU Parliament: State of the EU: Security, Ukraine, Gaza, Competitiveness, EU-US trade
Arbeit & Wirtschaft: Rede zur Lage der EU: Mehr Waffen, mehr Unabhängigkeit - State of the Union Address: More weapons, more independence (German only)
ETUC: Quality Jobs Act: Workers won't settle for half measures

Photo credits: © European Union 2025 - Source : EP