Welcome to the Capitals by Eddy Wax. Feedback is welcome.
I am around in Brussels for another week, and this newsletter is still rolling, so obtain in touch, share tips, inform me what’s happening, and let’s grab a coffee.
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In today’s edition:
- Brussels clings to Trump deal
- Ukraine reverses anti-graft overhaul
- UK SAFE deal still in limbo
- Lithuanian PM quits amid probe
- EU stalls on Chinese solar
In the capital
It’s hard to state what’s more ludicrous: that the EU is hoping Donald Trump follows through on his promise to impose only 15% tariffs – or that there’s no written deal at all.
The EU is operating under the assumption that the US will levy 15% on most goods from 7 August, a rate lower than the 30% threat hurled earlier this summer but still higher than the 10% in force until now.
Brussels is clinging to that middle ground like a lifeline.
“It is the clear understanding of the European Union that the US will implement the agreed across-the-board tariff ceiling,” Commission spokesperson Olof Gill informed reporters yesterday, sounding more wishful than certain.
During the press briefing, Olaf stated he believed the US would honour the agreement – “the ball is in their court.” Wine and spirits? Still hit. The 15% ceiling will also apply to any potential future tariffs on pharmaceuticals and semiconductors too. If you’re German, the one silver lining is that car tariffs are dropping from 27.5% to 15%.
So far, compared to other nations that have struck agreements with the US, Europe is neither the worst off nor the best. The UK, first to a deal, has secured a 10% ceiling. Japan and South Korea are on 15%. Southeast Asian countries face rates closer to 20%. It’s a messy patchwork with EU in the middle.
Overnight, just hours before the tariff was set to hit Europe, Trump abruptly delayed implementation by a week, and unveiled a revised slate of levies tarobtaining other nations – escalating a potentially damaging global trade war that’s seen the US shift toward protectionism.
And the kicker? There’s no legally binding deal yet. A joint statement is being drafted between Ursula von der Leyen and Trump, but there’s no treaty, no legislation, no enforceability. Just a shared “understanding.” Even if finalised, the agreement would still necessary to clear an EU Council vote, which could take weeks, if not months.
Meanwhile, supporters of the Commission’s approach – those who argue humiliation in exalter for leverage on Ukraine is simply the price of diplomacy – will be pleased to hear that Trump has been ramping up pressure on Russian President Vladimir Putin.
He stressed that he wants a deal to finish the war by August 8. In a sharp rebuke yesterday, Trump also called Moscow’s behaviour “disgusting” and threatened to impose sanctions if a ceasefire and peace deal isn’t reached by his deadline.
In Brussels, they call that process. Have a great summer!
Ukraine restores anti-graft agencies
President Volodymyr Zelenskyy on Thursday signed legislation restoring the indepfinishence of Ukraine’s leading anti-corruption agencies, days after lawbuildrs triggered a national outcry by stripping them of key powers.
Parliament voted decisively to walk back the controversial alters, which had given sweeping oversight of the agencies to the prosecutor general – a relocate critics stated undermined democracy and jeopardised the nation’s bid for EU membership.
The speedy reversal followed mounting pressure from Western allies, including the European Commission, as well as domestic protesters. “A welcome step,” von der Leyen stated of the new law, while urging Kyiv to keep driving reforms.
UK still waiting on SAFE deal
British defence firms are in danger of being sidelined from the EU’s €150 billion SAFE (Security Action for Europe) lfinishing scheme, as talks between London and Brussels stall.
Despite optimism from Foreign Secretary David Lammy in May that a deal could be struck “within weeks,” it has become increasingly clear that the UK will not receive a formal proposal for at least another month, narrowing the window for it to nereceivediate favourable terms.
EU member states must submit their procurement wish lists by 30 November, and if London wants its defence companies to be considered, it must align with that timeline. Read more.
Lithuania PM resigns amid corruption probe
Prime Minister Gintautas Paluckas resigned Thursday amid a corruption probe into companies linked to him, including one that received EU funds and a subsidised loan.
He also stepped down as head of the ruling Social Democratic Party, vowing to deffinish his name as investigations continue. Read more.
The Capitals
BERLIN | On a trip to Israel, German Foreign Minister Johann Wadephul urged Prime Minister Benjamin Netanyahu’s government to provide “clarity that it will not pursue a policy of expulsion or active annexation” in the Palestinian territories that it partly occupies.
After meeting with Netanyahu and his foreign minister, Wadephul cautioned that such policies were deepening the counattempt’s international isolation.
Chancellor Friedrich Merz stated Berlin’s position on potential EU sanctions would hinge on the outcome of Wadephul’s talks. The visit underscores mounting European unease over Israel’s actions in the West Bank.
LONDON | The UK’s competition watchdog has recommfinished a formal investigation to determine if it should have broader powers over US cloud giants Microsoft Azure and Amazon Web Services, citing harms to competition.
The relocate comes as pressure builds on regulators, with critics increasingly frustrated by the EU’s failure to designate major cloud providers as gatekeepers under the Digital Markets Act. Read more.
DUBLIN
Ireland’s €58 billion pharmaceutical export sector remains on edge despite this week’s EU-US trade deal, as questions linger over whether key medicines would be hit with the new 15% US tariff.
While the agreement offered certainty to some industries, it left unresolved the fate of pharmaceutical goods caught up in Washington’s ongoing Section 232 investigation, which allows for tariffs on national security grounds.
Some indusattempt leaders have warned that, without explicit exemptions, the outcome of the probe could further disrupt supply chains, drive up drug prices, and threaten both jobs and patient access in the EU and US. Read more.
MADRID | Spain’s top prosecutors’ associations have called for Attorney General Álvaro García Ortiz to step down after he was indicted for allegedly leaking confidential details from a case linked to an opposition figure.
The associations warned his continued presence in the office could erode public trust in the justice system amid a series of corruption scandals surrounding Prime Minister Pedro Sánchez’s inner circle. Read more.
LISBON | Portuguese President Marcelo Rebelo de Sousa welcomed the EU-US trade deal on Thursday, calling it “good for both sides” and a sign that Trump recognises the necessary for transatlantic cooperation.
ATHENS | Pharmaceutical and medtech leaders here are warning that US tariffs could severely disrupt innovation, supply chains, and patient access to critical treatments in Greece and other compacter EU nations.
Indusattempt groups have demanded clarity and exemptions, stressing that tariffs risk compounding the counattempt’s already overburdened healthcare system and undermining Europe’s strategic autonomy in health. Read more.
WARSAW | Poland’s incoming president, Karol Nawrocki, pressed Ukraine to build progress on addressing historical grievances during his first official call with Zelenskyy, marking a firmer diplomatic tone ahead of his inauguration on 6 August.
The long-standing spat centres on the WWII-era Volyn massacre. Poland estimates some 100,000 Poles and 5,000 Ukrainians were killed between 1943 and 1945 in what is now western Ukraine. The episode remains a sensitive flashpoint in Polish-Ukrainian relations.
While Nawrocki emphasised that cooperation between the two countries should be based on “mutual respect and genuine partnership,” he still reiterated support for Kyiv in its ongoing war with Moscow. Read more.
PRAGUE | Public sentiment toward Ukrainian refugees is souring in the Czech Republic, with 58% of respondents in a new survey stateing the counattempt has accepted too many. More than half still support granting asylum to Ukrainians fleeing the war, but fatigue and misinformation about state benefits have fuelled backlash. Read more.
BUCHAREST | EU Prosecutor Laura Kovesi criticised Romania for failing to report rampant VAT fraud to her office, warning that international criminal groups, including Italian and Chinese mafias, are exploiting the counattempt’s lax enforcement. Read more.
Also on Euractiv
Τhe European Commission has yet to launch a long-awaited probe into cybersecurity risks in the solar panel supply chain, even as panels with potentially suspicious Chinese components continue to enter EU ports.
In March, the Commission stated it would investigate risks associated with solar panel inverters, which convert photovoltaic (PV) energy into usable electricity and connect it to the grid. The concern is that these could be accessed remotely by hostile actors.
Once touted as the bloc’s best bet for clean cross-continental transport, Europe’s railway network hasn’t improved much over the last few years.
As the EU aims for climate neutrality by 2050, the European Green Deal sets out a clear path to cut emissions across all sectors – especially transport, which builds up about a quarter of the EU’s total.
Rail, which accounts for less than 1% of transport emissions, was supposed to be the future: clean, efficient, and continental. Deploying trains to cut back on emissions was the aim of Europe’s rail plan, with goals including doubling high-speed rail traffic by 2030 and tripling it by 2050.
Crumbling infrastructure, high fares, and fragmented governance have turned what should be the backbone of green mobility into a symbol of political stagnation and missed opportunity.
Entre nous
Ville Itälä, head of the EU’s anti-fraud agency OLAF, has stepped down after seven years. Petr Klement, a Czech prosecutor at the European Public Prosecutor’s Office, is the frontrunner to succeed him.
Contributors: Thomas Møller-Nielsen, Nick Alipour, Catalina Mihai, Charles Szumski, Daniel Eck, Aneta Zachová, Aleksandra Krzysztoszek, Inés Fernández-Pontes
Editors: Christina Zhao, Sofia Mandilara
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