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European Union, 2025, CC BY 4.0

Trade Agreement Between the U.S. and EU Enables Further Transatlantic Cooperation

The Stakes Go Beyond Tariffs

The outcome is sobering: at the eleventh hour, the EU and the U.S. reached a trade agreement that imposes tariffs once considered unthinkable. Important transatlantic trade is paying the price for further transatlantic cooperation on security issues.

Dr. Hardy Ostry, Jan Bösche
July 31, 2025
Country reports
IMAGO / Kyodo News

Suddenly in the Lead – Germany’s New Role in Global Health

On the new opportunities for Germany’s foreign, economic and security policy

Germany has assumed a leadership role in global health following the U.S. withdrawal. This new responsibility offers opportunities for foreign policy influence, security resilience, and economic strength. Germany’s high international standing is based not only on financial contributions but also on its position in science and innovative industry. Strengthening and institutionalizing this role could benefit Germany.

Lukas Lingenthal
July 31, 2025
Facts and Findings
smarterpics / NewAfrica

Rule of Law Report 2025

The most important findings at a glance

In July 2025, the EU Commission published its Rule of Law Report for the year 2025. While some countries in south-eastern Europe were formally certified as having made progress, the reality on the ground is often more complex. Albania, for example, has completed initial judicial vetting and adopted a new justice strategy, yet faces persistent administrative backlogs, unfilled positions, and political interference that undermine these reforms. Similarly, Bulgaria experiences repeated legislative and constitutional deadlocks that obstruct essential judicial reforms, with continued disproportionate influence of the Prosecutor General and Parliament over the judiciary. Public and business perceptions of corruption remain high everywhere, with anti-corruption efforts yielding minimal high-level convictions despite institutional restructuring. Across the region, a critical perspective reveals that legislative changes often mask deeper, unresolved issues. In Croatia, public trust in the justice system remains low, despite active oversight bodies. Montenegro's judiciary has seen a significant plummet in public trust, alongside staffing gaps and growing case backlogs. North Macedonia's judicial reforms are hampered by poor coordination, funding, and staffing shortages, leading to low public trust and growing case backlogs. In Serbia, persistent political interference and staffing shortfalls fuel a lack of public confidence in the judiciary. Media freedom faces challenges, including concentrated ownership with political ties, lack of transparency in state advertising, and intimidation of journalists. For all these countries, progress is fragile and susceptible to reversal without deeper, consistent enforcement, and demonstrable improvements in judicial independence, media freedom, and institutional checks and balances.

Dr. Pavel Usvatov, Alina Monceanu, Dr. Mahir Muharemović
July 31, 2025
Country reports
IMAGO / Bernd Elmenthaler

Unilateral recognition

Motives and consequences of France's recognition of Palestine in the national, European and international context

French President Emmanuel Macron has announced that France will recognise Palestine as a state. He published this announcement on Platform X in three languages: French, English and Arabic. Formal recognition is to take place in September during the next United Nations General Assembly in New York. Nevertheless, this step is already being seen as de facto recognition of Palestine. France will officially recognise Palestine as an independent state – i.e. as an autonomous entity under international law with a claim to sovereignty, probably based on the 1967 borders (West Bank, Gaza Strip and East Jerusalem). Macron also published a letter to Mahmoud Abbas, the President of the Palestinian Authority. In this letter, Macron emphasises that Abbas had already made certain commitments to him at the beginning of June that made recognition possible – such as disarming Hamas and announcing elections next year.

Anja Czymmeck, Max Willem Fricke, Nele Katharina Wissmann
July 30, 2025
Country reports

Guatemala faces difficult times

Some light in the tunnel - but more than a sword of Damocles

Guatemala is in a complex stalemate that could jeopardize the country's governability. 18 months after the government of the Social Democrat Bernardo Arévalo (Semilla) took office, observers see some light in the tunnel after recent increasingly critical and future-sceptical assessments. The government has little time to convince. Otherwise, there is a risk of an institutional stalemate or even an ungovernability scenario, which could pave the way for an autocratic solution in the 2027 elections.

Prof. Dr. Stefan Jost
July 25, 2025
Country reports
IMAGO

25th EU-China Summit in Beijing

A Sobering Anniversary

The 25th EU-China Summit on 24 July in Beijing took place under difficult circum-stances: although it marked the 50th anniversary of diplomatic relations between the EU and China, there was little sign of enthusiasm in the run-up to the event. The dif-ferences are too great – both in geopolitical terms and in economic and trade policy. As generally expected, no major breakthroughs were achieved on the numerous con-tentious issues. There were hardly any signs of a readjustment of relations, as desired by the EU. Nevertheless, both sides adopted a joint statement on climate issues and agreed to find a solution to the impact of Chinese export controls on rare earths.

Johann C. Fuhrmann, Dr. Olaf Wientzek, Jonas Nitschke
July 25, 2025
Country reports
IMAGO / Anadolu Agency

Japan: A resounding defeat for the government

For the first time in twelve years, the ruling coalition of LDP and Kōmeitō has lost its majority in Japan's Upper House

Japan is entering a phase of political uncertainty: following a clear defeat in the 2024 Lower House elections, the ruling coalition of the Liberal Democratic Party (LDP) and Kōmeitō has now also lost its majority in the Upper House. Rising living costs, an escalating trade conflict with the United States, and an increasingly polarized debate over immigration shaped the election campaign.

Paul Linnarz, Johanna Bieger
July 21, 2025
Country reports
IMAGO / ITAR-TASS

Foiled Coup in Armenia? Conflict with Church Leadership Escalates

Yerevan reports the thwarting of a violent coup with Moscow's fingerprints

On the afternoon of June 27, 2025, dramatic scenes unfolded in Etchmiadzin, the seat of the head of the Armenian Apostolic Church, located 20 km west of Yerevan. Special police units moved in to detain Mikael Ajapahyan. The archbishop, along with other church leaders, had openly opposed the government, but hundreds of people—including clergy and ordinary citizens—blocked the path until the uniformed officers withdrew. When the wanted man voluntarily turned himself in to the authorities later that evening, asserting his innocence, he became just one of fifteen high-profile arrests within a matter of days. Nikol Pashinyan’s government claims to have thwarted a violent coup attempt. Critics, however, accuse it of launching a politically motivated campaign against the Armenian Church and the opposition, and of betraying the country to its archrivals, Azerbaijan and Turkey. Societal divisions appear more entrenched than they have been in decades. One year ahead of the pivotal parliamentary elections in the summer of 2026, the current escalation is unfolding against the backdrop of an increasingly polarized debate over the country’s direction, as Armenia stands at a historic crossroads in its foreign policy.

Jakob Wöllenstein
July 18, 2025
Country reports
IMAGO / Bestimage

Keir Starmer's first year

First-year political record and German-British friendship treaty

One year after taking office, Prime Minister Keir Starmer surprises with a foreign policy record that even sceptics acknowledge. He has succeeded in repositioning the UK as a global and European player - with initiatives to support Ukraine, to build and expand European defense capabilities and through international trade agreements. One of his most important successes is undoubtedly the rapprochement with Europe. At the beginning of his term of office, Starmer announced a “Brexit reset” in order to advance cooperation with European partners. Relations with Germany in particular are a high priority. During the first official visit by Federal Chancellor Friedrich Merz on July 17, a comprehensive bilateral agreement will be signed with Germany - the most far-reaching agreement that the UK has ever concluded with a single European country. Starmer himself speaks of a “generational treaty”. Domestically, however, the balance sheet is mixed. The Prime Minister is under pressure - from his own party, from an increasingly dissatisfied electorate, and from the opposition. The right-wing populists from Reform UK are a particular concern. His government policy sometimes seems contradictory: pragmatic in its implementation but often lacking a discernible guiding principle. Since taking office, Starmer has shown considerable ideological flexibility - a course that is causing friction within the party. Even before the election, he had already led Labour towards the political center; in many areas, his government is now following the agenda of its Conservative predecessors. This change of course is particularly evident in migration policy, but is also reflected in other areas: deregulation of environmental protection in some areas, cuts to the welfare state and a significantly increased defense budget at the expense of international development cooperation. On the occasion of the first anniversary of the Starmer government, one might provocatively ask whether Labor are the better conservatives.

Dr. Canan Atilgan, Sebastian Schnorrenberg, Marcus Leal
July 16, 2025
Country reports
IMAGO / Anadolu Agency

Bulgaria and the Euro

The most important steps ahead of the 2026 introduction

Bulgaria continues to prepare intensively for adopting the euro. On July 8, the European Parliament and ECOFIN—the Council for Economic and Financial Affairs of the Council of the European Union, composed of the finance and economic ministers of the EU member states—gave their final approval for the country to join the eurozone starting January 1, 2026. First, the European Parliament in Strasbourg voted in favour of Bulgaria's accession to the eurozone by a large majority. ECOFIN then unanimously adopted all the necessary decisions in Brussels. This was the last hurdle for the country to overcome, making the introduction of the euro irrevocable. Bulgaria meets all EU convergence criteria ("Maastricht criteria"), its euro adoption is not based on any political compromise.

Norbert Beckmann-Dierkes, Borislaw Wankow
July 16, 2025
Country reports

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