EU strings attached
The crackdown stems from a clause that the Commission introduced in the budget rules in 2024 that set out “security requirements” for certain EU public contracts that involve strategic assets.
The Commission will outline what those requirements are and which sectors they’ll affect next month. The guidelines could, for example, go as far as restricting Chinese firms from producing inverters used in solar panels, one of the officials said. The rules will also apply to projects undertaken by the European Investment Bank, the bloc’s lending arm. Brussels will stop short of singling out the countries that’ll be cut off from EU public money, however.
Under the new budget in 2028, the overhaul could narrow the access of foreign companies to the European Competitiveness Fund — a €410 billion cash pot to promote industrial development — and the Global Europe Fund, which is worth €200 billion and finances EU aid to developing countries.
The crackdown stems from a clause that the European Commission introduced in the budget rules in 2024. | Nicolas Economou/NurPhoto via Getty Images
The French may welcome the looming crackdown, as Paris pushes for a “European preference” across the whole budget. But the Commission’s pitch will meet resistance from a group of Northern European countries.
In a joint letter, Estonia, Finland, Latvia, Lithuania, the Netherlands and Sweden warned that prioritizing European goods and services “risks wiping out our simplification efforts, hindering companies’ access to world-leading technology … and pushing investments away from the EU.”
Joshua Berlinger contributed reporting from Paris.