Competitiveness Check—December 22 Special Edition
The Quick Take
The transatlantic security and economic relationship has moved beyond a crossroads to a deliberate phase of recalibration. In articulating a more transactional and conditional approach to US foreign policy, the Trump administration’s National Security Strategy has accelerated this shift. For a deeper look at what this reboot means, read GMF President Dr. Alexandra de Hoop Scheffer’s latest opinion piece here.
GMF experts also break down the implications of the upcoming US National Defense Strategy here, and you can catch their analysis of the 2026 National Defense Authorization Act here.
Amid the rise of great-power competition, the EU’s December 3 communication on how the bloc should implement its 2023 economic security strategy falls short of delivering new and decisive tools to reclaim agency, argues GMF’s Etienne Soula.
Meanwhile, a proposal for the bloc to mobilize frozen Russian sovereign assets to support Ukraine collapsed. Instead, EU leaders struck a deal to lend €90 billion to Ukraine, borrowed against the bloc’s shared budget. Tensions are also brewing over the EU–Mercosur trade deal, which hangs in the balance. Taken together, these developments raise fresh questions about Europe’s ability to project unity and act decisively.
Top 10 Transatlantic Trade-Related Developments
December 2: The European Commission adopted its RESourceEU Action Plan, building on the Critical Raw Materials Act. The plan promotes a coordinated strategy to secure critical raw materials through diversified supply chains, accelerated permitting processes, joint purchasing, and the establishment of a European Critical Raw Materials Centre.
December 3: The US Department of Transportation and National Highway Traffic Safety Administration announced a proposal to weaken fuel economy (CAFE) standards for model year 2022-2031 passenger cars and light trucks.
That same day, the European Commission opened a formal antitrust investigation into Meta over new WhatsApp artificial intelligence (AI) policies that may block rival chatbot providers from accessing the platform.
December 4: The EU imposed a €120 million Digital Services Act fine on Elon Musk’s X for deceptive blue‑check design, inadequate ad transparency, and failure to provide researcher access.
Four days later, the Commission opened a formal antitrust investigation into Google's use of online content to train its AI models and produce overviews on search results pages.
In response, the Trump administration has threatened European companies with penalties and has warned of a Section 301 investigation.
December 10: The European Commission released its Grids Package, introducing legislative proposals to accelerate grid permitting, upgrade cross‑border planning, and expand capacity for renewables, storage, and EV‑charging infrastructure across member states.
December 11: EU policymakers reached a political agreement on new foreign direct investment (FDI) screening rules. The framework facilitates information exchange between member states and the Commission, and establishes mandatory national investment-screening mechanisms.
December 12: The US Department of State said that the United States—with Australia, Israel, Japan, the Netherlands, Singapore, South Korea, the United Arab Emirates, and the United Kingdom—will launch a "Pax Silica" partnership for cooperation on AI, critical minerals, and other key technologies.
December 15: The US Court of International Trade ruled that it retains authority to order reliquidation and tariff refunds should the Supreme Court strike down International Emergency Economic Powers Act (IEEPA)‑based tariffs, confirming importers will not lose refund rights even after liquidation.
That same day, the United States suspended implementation of its Technology Prosperity Deal with the United Kingdom, citing frustration over UK nontariff barriers including digital‑services taxation and food‑standards regulation.
Also that day, the UK government announced new crypto‑market legislation that will take effect in 2027, bringing crypto assets fully under Financial Conduct Authority supervision and rules equivalent to those governing traditional financial products.
Furthermore, the United States backed a $7.4 billion investment in a critical minerals processing plant to be built by Korea Zinc.
December 16: The European Commission announced revisions to its 2035 combustion‑engine phaseout. Under the new plan, 90% of new cars sold from 2035 would have to be zero-emission, rather than 100%.
That same day, the Commission proposed measures to strengthen its Carbon Border Adjustment Mechanism (CBAM) in response to feedback received from industry.
December 18: US President Donald Trump issued an executive order on “Ensuring American Space Superiority”. The order sets a goal of establishing an “initial” lunar base by 2028 and reiterates the administration’s Golden Dome plans for a comprehensive air and missile defense shield over the United States.
That same day, the US International Development Finance Corporation announced that the US-Ukraine Reconstruction Investment Fund is fully operational. The fund is now poised to make its first investments in 2026.
Also that day, the European Parliament and the Council agreed on an updated retail investment framework to empower consumers and increase competitiveness in EU financial markets.
December 22: The US Department of the Interior announced that it was halting the construction of five large-scale offshore wind projects off the US coast due to “national security risks”.
That same day, Google said it plans to acquire Intersect Power, a data center and clean energy infrastructure company, for $4.75 billion. Solar has been Intersect Power's primary energy generation source.
Figure of the Fortnight
€390 billion: The amount of EU investment stocks in Mercosur countries in 2023. The EU is the biggest foreign investor in the South American trade group’s member states. In 2024, the EU’s trade in goods with Mercosur was worth over €111 billion. Trade in services in 2023 (the most recent year for which data is available) was just over €42 billion.
Quote Unquote
“The year 2025 will be remembered as the year of the tariff, regardless of one’s economic ideology. International trade is neither good nor bad—it just is. The real question is whether trade patterns serve the national interest. For President Donald Trump and his administration, that means a trade policy that accelerates reindustrialization.”
US Representative Jamieson Greer in a December 22 Financial Times opinion piece.
“From the bottom of my heart, I’m a convinced transatlanticist. But what is so important? [What’s] important is that … we take pride in being the European Union, that we look at our strength and that we deal with the challenges that we do have. Of course, our relationship to the United States has changed. Why? Because we are changing. And this is so important that we keep in mind: What is our position? What is our strength? Let’s work on these. Let’s take pride in that. Let’s stand up for a unified Europe.”
European Commission President Ursula von der Leyen in a December 11 POLITICO interview.
The views expressed herein are those solely of the author(s). GMF as an institution does not take positions.