A defining stretch for the Commission president
Ursula von der Leyen is entering what could prove to be the most consequential three years of her decade at the helm of the European Commission. Her second term ends in 2029. If it is also her last, her political legacy will increasingly be judged not by the crises she was forced to manage — the pandemic, Russia’s invasion of Ukraine, the energy shock and wars on Europe’s wider periphery — but by whether she managed to address some of the European Union’s deepest structural weaknesses.
According to an analysis by gr, six major challenges are capable of defining her legacy: competitiveness, Europe’s regulatory confrontation with the United States, the future of the Green Deal, defense and Ukraine, enlargement, and the EU’s next long-term budget. Together, they lead to a much bigger question: Can Europe transform its enormous economic and regulatory weight into genuine geopolitical power?
The industrial survival battle
The first challenge is economic — and potentially existential for Europe’s industrial model. The EU must determine whether it can reverse its relative decline against the United States and China while preventing traditional European industrial powerhouses from steadily losing competitiveness.
Mario Draghi has put a staggering number on the challenge: Europe needs roughly €800 billion in additional investment every year to close its investment and productivity gap. High energy prices, fragmented capital markets, regulatory burdens and weaker productivity growth are all putting pressure on European companies.
Then there is China. European manufacturers are competing with Chinese electric vehicles, batteries, solar panels and steel while remaining heavily dependent on Beijing for several critical raw materials.
Trump, Big Tech and the regulatory clash
The second challenge is political and regulatory. Europe is locked in a confrontation with the United States over technology regulation and trade. The EU has implemented the Digital Markets Act and Digital Services Act, which together impose new obligations on the world’s largest digital platforms. The moves have drawn criticism from Washington and from the tech industry itself, setting up a transatlantic standoff that von der Leyen must manage carefully.
At stake is not only the future of American tech giants in Europe but also the credibility of the EU’s regulatory model as a global standard setter.
The Green Deal under pressure
The third challenge is the future of the Green Deal, the EU’s flagship climate policy. The package has already sparked a backlash: farmers have protested across Europe against parts of the Green Deal, and extreme weather events including wildfires, heatwaves and drought are occurring across the continent, adding urgency to the transition.
Von der Leyen must balance the bloc’s climate ambitions with the political and social costs of the transition. The protests have shown that public support cannot be taken for granted, and the Commission will need to craft policies that are both green and politically sustainable.
Defense, Ukraine and the security question
The fourth challenge is defense and Ukraine. The EU has provided significant support to Ukraine since Russia’s full-scale invasion, with total support surpassing €220 billion, according to reports. The bloc has also put in place a €90 billion Ukraine Support Loan for 2026–2027, with around €60 billion intended for defense capabilities. In addition, the EU’s SAFE instrument provides €150 billion to support defense investment.
These figures underline the scale of Europe’s commitment, but they also raise questions about sustainability. As the war continues, von der Leyen must ensure that European defense spending keeps pace with the needs on the ground and that the financial and industrial base for such support remains solid.
Enlargement and the budget question
The fifth challenge is enlargement. The EU’s strategy towards aspiring members — notably in the Western Balkans and Eastern Europe — will shape the bloc’s future borders and influence. But enlargement is not just a political gesture; it carries significant financial and institutional implications.
The sixth and final challenge is the EU’s next long-term budget. With the current multiannual financial framework approaching its end, the Commission must negotiate a new budget that can fund the bloc’s priorities, including defense, competitiveness and cohesion. The question of how to pay for it all — potentially involving new own resources or debt — is one of the most sensitive political questions facing the EU.
A balance act for the next three years
Von der Leyen’s task over the next three years is an extraordinarily difficult balancing act. She must respond to external pressures from the United States and China, manage the internal strains over the Green Deal and enlargement, and secure the financial means to back her ambitions.
The six challenges are deeply interconnected: industrial competitiveness affects the capacity to invest in defense; regulatory clashes with Washington influence the climate agenda; and the budget determines whether any of it is feasible.
Whether von der Leyen can turn Europe’s economic and regulatory weight into real geopolitical power will define not only her own legacy but the EU’s place in a rapidly changing global order.