DUBLIN — EU and Chinese officials are already discussing the next sectors for trade talks as Brussels prepares to review implementation of their latest understanding in January, EU trade chief Maroš Šefčovič told POLITICO on Friday.

“In January we can assess how it worked and if it delivered all parts of our agreement,” Šefčovič said, referring to an Oct. 9 pact by which China will voluntarily reduce exports of hybrid vehicles to the EU by almost half to 350,000 units in 2027.

That deal also lowers tariffs on European goods such as auto parts and footwear, and smooths exports of rare earth elements to the EU. 

After a scheduled January videoconference with his counterpart Wang Wentao, Šefčovič said he hopes the two can deliver results in March 2027 at their next round of in-person talks in Brussels. 

“I would like to see that we both have an understanding of what sectors we are going to focus on next,” he said.

The intense engagement with China comes as the bloc seeks to rebalance mutual economic ties, which EU officials say have been distorted by Chinese subsidies, market barriers and a surge in imports. Šefčovič stressed the urgency of the task, given that the EU’s trade deficit with China “reached almost €197 billion in the first half of this year. At this rate, we could break the 2022 record” of €397.3 billion.

“A part of our team is working on implementing all what we agreed, and [another] part of the team is talking to our Chinese counterparts on what should be the next sectors, next areas on what we want to focus the work on. Hopefully with another [Trade and Investment Consultation] in Brussels we can actually deliver the results,” he added. 

“The primary objective for us … is to rebalance the trade.”

At a press conference on Friday, the trade chief said the European Commission was looking to shield more sectors from Chinese overcapacity, with plastics the leading candidate for safeguard measures — a mix of quotas and tariffs.

“We are currently analyzing what would be the best candidates and sectors to be addressed” through safeguard measures, he said. “Currently, what I think is the closest, is the plastic sector.”

Brussels is also juggling requests from the EU’s 27 member countries, which all seek to protect the industries that are key to their economies.

Commission President Ursula von der Leyen told EU leaders last week that Brussels wants to shield the chemical and machinery sectors next, POLITICO reported.

Šefčovič added that the European Commission was looking at proposing new trade tools to nudge EU companies to diversify their suppliers, expected in early December.

“We would respect what we have heard from every single business: Keep it simple, no additional reporting,” he said. 

The EU executive is also looking to incorporate a proposal by France and Germany for a new tool that would allow Brussels within days to restrict — or even close — access to Europe for countries that severely distort the bloc’s single market. 

“It’s better to present a new instrument,” Šefčovič told POLITICO. “We could initiate it very quickly and … act very quickly.”

ROME — Roadblocks by truckers in southern Italy are exposing the limits of Prime Minister Giorgia Meloni’s hardline approach toward protests, as she concedes she will have to take a carrot-and-stick approach to demonstrators struggling with soaring fuel costs.

The demonstrations across the south are fast spiraling into a full-blown economic crisis. Truck drivers and farmers protesting soaring diesel bills have blocked highways, ports and distribution centers this week, leaving supermarket shelves empty and petrol pumps dry. Airports in the south are also suffering from fuel shortages.

After a cabinet meeting on Thursday, the right-wing Meloni vowed to use a security decree to clear the roadblocks, but also pledged to give financial relief to farmers and fishermen crippled by the price of diesel.

Regarding the decree, she said her government would not be “blackmailed by those who use violence as an instrument of pressure.” But she cushioned that blow by acknowledging that financial relief measures were needed to offer “immediate responses, especially to workers, to people who are in difficulty, to families.”

With elections expected in spring next year, the truckers’ protests threaten to shift the political debate from immigration and crime to whether Italians can afford to keep their businesses running. 

Gaetano Amato, a lawmaker from Naples for the populist left 5Star Movement, accused the government of offering security measures instead of answers to the economic grievances driving the protests.

“The government has done nothing and is continuing to do nothing, because it is basing everything on security decrees,” he told POLITICO. 

Stefano Orlacchio, president of the opposition center-left Democratic Party’s youth wing in the southern region of Campania, also slammed the government’s response as “an anti-southern attitude.”

“The protests in the south aren’t being taken into consideration at all,” he told POLITICO.

Diesel squeeze

At the heart of the revolt is a squeeze that truckers say they can no longer absorb. Diesel prices in Italy have risen by about a third since the U.S. and Israeli strikes on Iran began, and the cost of a long haul journey like Naples to Milan has climbed with them. 

Pasquale, a truck driver with a Campania-based company, who asked POLITICO to withhold his surname for fear of retaliation, said a trip’s profit had now shrunk sharply once fuel, tolls and wages were covered, and that the extra cost was working its way down the supply chain to supermarket shelves. 

Far-right Transport Minister Matteo Salvini of the League party, who posed in a truck cab a few months ago, should “come spend a week with me and we’ll see how comfortable it is,” Pasquale quipped.

While a cap on fuel prices exists on paper, he added petrol stations had ignored it “in these days of chaos.”

Beyond fuel prices, Pasquale zeroed in on EU environmental rules that Italian businesses struggle to comply with, even as cheaper foreign produce continues to reach supermarket shelves. “How can you face something like that?” he asked.

The Brussels-based International Road Transport Union has also appealed directly to European Commission President Ursula von der Leyen for help. 

In a letter sent on Thursday and seen by POLITICO, the group and its national member associations said they did not support the blockades but warned that soaring diesel prices were pushing operators to the brink, calling for extended EU state aid and tougher rules on late payments from customers.

The blockades hit hundreds of supermarkets and dozens of distribution centers, according to retailers’ association Federdistribuzione. Fresh fruit, meat and fish ran out within days, followed by other food products, leaving some shops completely empty.

Carlo Alberto Buttarelli, the association’s president, put the damage at “tens of millions of euros,” with fresh food spoiling in trucks and warehouses. Supplies were beginning to resume in Sicily and Calabria on Thursday, but disruption remained in Campania. 

No room to maneuver

Meloni has limited resources to offer relief. Italy remains subject to EU deficit proceedings, constraining Rome’s room for additional spending, while the international instability driving fuel prices higher lies largely beyond her control.

Amato dismissed the announced support from the cabinet meeting on Thursday as money that had already been promised.

While the government’s reaction to last weekend’s northern protests, which were hijacked by masked gangs that looted shops and set fires, was to link the unrest to immigration and deploy troops, the southern unrest is harder for Meloni to handle because it demands concrete economic relief, said Marco Valbruzzi, a researcher at the University of Naples Federico II.

Frustrated voters could turn to the 5Star Movement, which has previously channeled economic discontent in the south, or abstain from voting altogether. 

The protests could also weaken the appeal of early elections expected in April or May next year. A winter of sustained protests would give Meloni a reason to wait until autumn 2027, hoping for an ease in international instability and improved fiscal flexibility. 

If economic grievances dominate the campaign, “she is playing an electoral game on a field that she cannot control,” Valbruzzi said.

BRUSSELS — The EU is preparing to try and persuade Canada and the U.K. to increase their support for Ukraine as part of efforts to plug the €70 billion funding gap Kyiv faces next year.

The EU-Canada summit on Oct. 29-30 and the EU-U.K. summit on Nov. 20 will give Brussels a chance to make the case at the highest level. With Kyiv’s financing needs rising and U.S. backing uncertain, Brussels is increasingly looking to non-EU allies to contribute more, five EU officials, including two from the European Commission, and two EU diplomats told POLITICO.

The EU and its member countries provide 80 percent of Ukraine’s external aid, Commission President Ursula von der Leyen said Friday. “We urgently need other partners to step up.”

European Council President António Costa told the European Parliament on Wednesday morning that “international partners have to intensify and step up financial support to Ukraine.”

The EU has committed to a €90 billion loan for 2026 and 2027, intended to cover about two-thirds of Ukraine’s needs. Brussels had expected other partners — including Canada, Japan, South Korea, Australia and Norway — to provide another €45 billion, but much of that money has been slow to arrive as other governments have yet to firm up or disburse the support Brussels expected.

While calls to help Ukraine defend itself are not new, the projected 2027 bill has grown as Russia intensifies its assault, the U.S.-Israeli war with Iran drives up costs and Washington shifts toward positions more favorable to Moscow — leaving Europe and other allies to shoulder more of the cost of keeping Kyiv afloat.

Brussels is heading into negotiations about closer economic and defense ties with London and Ottawa. Diplomats and EU officials said they do not expect a formal bargain, but that support for Kyiv from the EU’s partners is likely to shape the political climate around the talks. Like others in this article, they were granted anonymity to speak about the sensitive diplomacy.

The EU has also raised Ukraine’s 2027 financing needs at meetings of the International Monetary Fund, the G7 and the G20, as well as with Gulf Cooperation Council countries.

“During my meetings in Bangkok, the need to secure financial support for Ukraine in 2027 was a prominent topic,” European Economy Commissioner Valdis Dombrovskis told POLITICO, referencing last week’s IMF and World Bank Group meetings. He said he called for “broad burden sharing and stressed the importance of international partners each doing their part as Ukraine continues fighting Russian aggression.”

All the EU officials and diplomats stressed that the push was not a criticism of the U.K. or Canada, both of which are strong supporters of Ukraine. The point, they said, is that Kyiv’s needs have grown.

The U.K. says it has committed a total of £25 billion for Ukraine and Canada has promised the equivalent of €5.4 billion in military assistance and €8.2 billion in direct financial support.

The EU and its member countries say they have contributed over €231 billion since Russia’s full-scale invasion, including military aid, budget support and guarantees, support for Ukrainians hosted in the bloc, and proceeds from immobilized Russian assets — an amount one senior EU diplomat described as already “over and above.”

How to meet Ukraine’s financial needs has become “a central discussion in every single meeting” with partners supporting Kyiv, a Commission official said.

The push to secure Ukraine’s financial needs comes as support for Kyiv will be tested in a series of elections across Europe next year. In France, far-right front-runner Marine Le Pen has vowed to end aid if elected president in 2027, while in Italy, Prime Minister Giorgia Meloni faces a challenge from Russia-friendly Roberto Vannacci ahead of next year’s election.

The looming votes, combined with the unpredictability of Washington’s backing for Kyiv, mean European countries need to look beyond their own budgets, the senior diplomat said. “We need to think wider and broader.”

The EU is also urging the Ukrainian government to secure more support from non-EU backers. “This is the first next step that they need to secure from their partners,” the Commission official said.

Not ‘pulling a Trump’

EU ambassadors are set to talk about the upcoming Canada and U.K. summits tomorrow, with Ukraine funding expected to form part of the discussions, the two diplomats said.

Brussels, “without pointing the finger,” wants to use the run-up to the meetings to press for broader support, the senior diplomat said. But the EU “won’t be pulling a Trump” and explicitly linking favorable treatment to contributions to Ukraine, they added.

The Commission has not set out what it will ask partners for or how any request might connect to trade and defense talks. The diplomat said the EU still needed to work out “how much will translate in joining those dots.”

Von der Leyen proposed making Canada the EU’s first “associate member” in her State of the Union speech last month. The October summit in Montreal is an opportunity to develop the idea.

Ottawa will participate in the EU’s SAFE program, which finances joint defense procurement, giving Canadian companies preferential access to SAFE-funded contracts. Closer defense cooperation and industrial access could form part of the wider conversation about support for Kyiv, one of the diplomats said.

In a statement to POLITICO, Kathryn Serieux, a spokesperson for Canada’s Privy Council Office, said Ottawa “is and has been a steadfast supporter of Ukraine,” with Canada committing nearly C$26 billion in military, financial development and humanitarian assistance.

“Canada continues to stand by Ukraine and remains engaged with international partners on Ukraine’s needs,” Serieux said.

The U.K. summit is expected to advance Prime Minister Andy Burnham’s promised reset with the bloc, including agreements on youth mobility, food and emissions trading. Burnham has said the status quo is “not good enough” and wants Britain to move closer to the EU.

London wants U.K. companies to count as European under the proposed Industrial Accelerator Act, which would give preference to goods made in Europe in public contracts and industrial support. British officials worry U.K. firms could lose out despite close links between British and European supply chains.

Three U.K. officials said Tuesday they had not heard of a request for Britain to provide more support for Ukraine in exchange for letting its companies qualify under the act. A fourth EU official said Ukraine was expected to feature in the summit declaration with the U.K., but that it would reflect both sides’ efforts to help Kyiv, rather than a Brussels demand for more support.

The EU is also pressing Japan to increase its contributions, with one senior EU official saying it was lagging in 2026. A person familiar with the thinking in Tokyo pushed back on the idea that Japan was not pulling its weight, saying Tokyo had already given around $20 billion in support to Kyiv — but there could be room for more if Ukraine requested it.

Tokyo is also seeking assurances that Japanese companies will retain access to the EU market, following concerns the Industrial Accelerator Act’s “Made in Europe” preferences could put its firms at a disadvantage.

The Mission of Japan to the EU didn’t respond to a request for comment.

Australia says it has not yet received a request for more funding for Ukraine for 2027. Canberra is likely lower on the list, if it is on it at all, because its prime minister and foreign minister met Ukrainian President Volodymyr Zelenskyy at the U.N. General Assembly last month and announced additional funding and a security agreement, an Australian official said.

Dan Bloom contributed reporting from London. Amanda Copp contributed reporting from Canberra. Mike Blanchfield contributed reporting from Ottawa. Gregorio Sorgi contributed reporting from Brussels.

LONDON — Labour swept to power with a big, expensive promise: to create a government-owned energy company, hand it billions to invest in British renewables, and watch it grow, eventually, to rival other state-owned energy giants. 

Two years on from the foundation of Great British Energy, that isn’t what has happened. 

Analysis from POLITICO shows billions of pounds from its budget have been redirected to schemes not included in GBE’s initial remit, stripping away some of the cash earmarked for costly, large-scale renewable energy projects like wind and solar. Those funds are being used instead for very different purposes, like planning new nuclear schemes and reviving Britain’s creaking electricity grid. 

Set up by then Energy Secretary Ed Miliband, the government backed GBE with £8.3 billion of fresh funding. Its purpose at the time seemed clear. “Great British Energy will own, manage and operate clean power projects,” Miliband pledged, “and generate energy in its own right.” 

Labour officials familiar with GBE plans told POLITICO in 2024 local projects would get around £3 billion of its total budget, while the rest would go on helping the company establish itself in the market, including by taking stakes in wind and solar projects. 

Yet now experts can’t agree on what, exactly, GBE is for. 

How to spend it

Miliband’s GBE pitch to the public was ambitious.  

The company would allow Britain to become a bigger player in its own clean energy market in Labour’s dash to hit green goals, he said. Referencing huge state-owned companies in Denmark and France, he told Channel 4 News weeks after the election that GBE was “not going to become Ørsted or the generation arm of EDF overnight. But that is the long-term vision.” 

Soon after GBE passed into law, though, former Chancellor Rachel Reeves reassigned £2.5 billion of its budget to help developers design small-scale nuclear power plants and prep sites where those mini-nukes will eventually go.

The government also scaled back its funding for those local, smaller-scale projects, which include getting solar panels onto school and hospital roofs. The mooted £3 billion for GBE’s Local Power Plan became just £1 billion when more details were announced this February. 

GBE has set aside another £1 billion to build up clean energy supply chains.  

And that’s all before Prime Minister Andy Burnham used Labour’s annual conference to pledge another whack of GBE’s budget to a totally new venture: Great British Grid. 

Enter GB Grid  

In a bid to put his own stamp on Miliband’s pet project, Burnham announced that the new unit would sit within GBE, using some of its budget to speed the build out of Britain’s creaking grid network.  

GB Grid will invest alongside existing grid operators in a bid to cut costs, Energy Secretary Miatta Fahnbulleh said last week, at a time when the grid regularly struggles to handle the levels of power being generated by developers. 

Energy experts are torn over whether GB Grid, in particular, is a smart pivot for the government — but acknowledge it is not the same thing Miliband promised to deliver.  

“I think the focus has shifted, but I don’t think that should be seen as a problem,” said Joshua Emden, a senior research fellow at the Institute for Public Policy Research think tank. 

GB Grid would have access to £4 billion of GBE funding, according to media reports published at the time of Burnham’s announcement, although officials from the Department of Energy Security and Net Zero insist they “don’t recognize” that figure. 

It is still enough for Kemi Badenoch’s Conservatives to pile the pressure on ministers to explain why their plans have changed. 

“Taking half the GB Energy budget and putting it into a venture that was only announced a few weeks ago leads to the obvious question of: What actually is GB Energy for? And does the GB Energy of today bear any resemblance to what the government envisaged in July 2024?” asked Shadow Energy Minister Harriet Cross. 

Doubters and defenders  

Some energy industry officials are doubtful that setting money aside for grid investment is the best use of public cash.  

“If it does that last mile [of grid] to a data center, if it helps where there isn’t actually any program or plan, [then] fine. We’re not going to say: ‘No, don’t spend it on making the grid better,’” Dhara Vyas, chief executive of the industry group Energy UK, told a panel at Conservative Party Conference earlier this month. 

But transmission operators — who run the network — are already spending tens of billions on the grid, she said. “The energy transition will be paid for by the private sector.”  

GBE “made a slow start and has focused on low-impact activities, important though they are,” said Bill Esterson, a Labour MP and chair of parliament’s Energy Security and Net Zero Committee. Creating GB Grid, he argued, “suggests a shift in emphasis to build what the country needs where the network companies are not delivering.” 

The pivot “makes sense as an efficient use of government money,” argued IPPR’s Emden, if there’s a choice between investing in power generation — where there’s competition between providers — and in the grid where private networks have a “total monopoly.” 

GB Energy has “the foundations now to create something genuinely useful,” argued one government figure. “Politicians of all stripes should give it the space to get on with the job.”  

A spokesperson for DESNZ said “securing new homegrown energy and building a grid fit for the 21st century work hand in hand. Great British Grid will bring public and private investment together, helping to build the infrastructure Britain needs.” 

Additional reporting by Nicholas Earl.

The cyberattack last week that hit hundreds of French supermarket refrigerators had Europeans wondering if the nonstop warnings about AI risks had finally landed in the real world.

They hadn’t — at least, not yet.

Experts say the attack, which forced hundreds of retailers to throw away defrosted food and spoiled milk, was mostly a reminder of the importance of old-school cybersecurity in safeguarding essential goods and services.

The attack is a “typical example” of how “low-key cyber-enabled sabotage can affect very crucial supply for society,” said Ferdinand Gehringer, hybrid threats lead at FTI Consulting. 

It’s arguably the most consequential hack in the European Union this year, with tangible, disruptive real-world repercussions. France’s Prime Minister Sébastien Lecornu personally managed the fallout, which prompted coordination and information-sharing at the EU level. 

The perpetrators, whose identity and motives are currently unknown, hacked into digital systems to remotely raise the temperature of refrigerators in supermarkets including Intermarché and Carrefour.

One cybersecurity expert working with Lecornu’s office said the French government held meetings after the attack to try to map all the potentially affected sectors, beyond supermarkets. “We’re in the middle of the flu vaccination campaign,” he said, referring to vaccine storage, which also relies on temperature control solutions, though no such attacks have been registered.

To add to the fear and confusion, supermarkets in the Netherlands and Belgium experienced unrelated cyber incidents that same week. Though there was limited impact in those cases, they were a good example of “how big our reliance is in the food supply chain on IT and network systems,” Dutch food security minister Silvio Erkens told POLITICO. 

The attacks come after citizens and policymakers have spent months being bombarded with warnings about scenarios in which unpredictable advanced artificial intelligence models escape human control.

While most good and bad actors on the internet are increasingly using AI models to increase speed and capacity, cyber experts say the hackers in question in the French case most likely used traditional methods to take advantage of devices needlessly exposed to the internet.

Connecting devices to the internet in this way is “an old-fashioned bad practice,” said Amir Preminger, chief technology officer at Claroty, a cybersecurity company that identified a software flaw in a product made by Danfoss, one of the refrigeration companies targeted by the French hacks. Danfoss fixed that flaw in 2025. 

Food systems

The attacks come at a time when Europe’s food security is already under considerable pressure due to geopolitical insecurity and climate change. The continuing disruptions in the Strait of Hormuz are pushing up fuel and fertilizer prices at a time where farmers struggle with the fallout of extreme drought that caused lower yields in many parts of Europe. These problems are compounded by the blockade of the Black Sea which is fueling the rise of global food prices.

“It is very serious that cyber criminals attack our food systems,” said Else Groen, director general of trade body Independent Retail Europe. She nonetheless stressed that food supply chains are resilient, which reduces the chances that consumer food supply would be endangered — even if such attacks are already a “major blow” for retailers operating on razor-thin margins.

The incidents bring to the fore a long-running problem with so-called operational technology, meaning industrial devices with physical outputs, like refrigeration systems. Critical sectors are packed with these kinds of devices, many of which are old, poorly protected, unnecessarily connected to the Internet, or some combination of the three. They’re also obscure and sometimes forgotten, despite the ramifications if they’re tampered with.  

And last week’s problems are far from solved. French and German cyber authorities warned that attacks were probably still ongoing, and the Greek cyber agency and an industry tracker said after the attack that there were hundreds of devices still connected to the internet.

Preminger too said there are still devices exposed, though he added that the number is declining, and not all are necessarily vulnerable to attack. Another research group found that the number of exposed Danfoss devices had significantly decreased.

Finding a fix

What’s changed with the widespread diffusion of advanced AI models is that cyber attacks are now faster and easier to replicate. Claroty reproduced the original flaws in Danfoss products in 28 minutes at a cost of $6, it said. 

In broad terms, AI makes it easier to carry out many types of cyberattacks and enables attackers to pounce on software flaws more quickly. Financially motivated cybercriminals — who have already spent years extorting businesses and disrupting essential services like hospitals — can use AI to simultaneously launch attacks on multiple targets.

Though the motive for the attacks on French supermarkets remains unknown, it is notable that there was no reported attempt at extortion. The strike did come as Russia ramps up its campaign of hybrid warfare against Europe, and senior EU and European leaders have consistently warned that Moscow could use cyberattacks to disrupt real-world services. Beyond food supplies, AI-enhanced targeting could be aimed at banking, hospitals and the functioning of the internet itself.

Still, these fears of bad human actors using AI should be distinguished from the science-fiction scenarios pushed by so-called AI doomers, in which bots themselves are motivated and able on their own to wipe out humanity.

Digital security experts, including the EU’s own in-house cyber team, are also turning to AI for defense. But it’s not a silver bullet, said Rémi Enjolras, a chief technology officer at Splunk, part of Cisco. Critical industries need to stop “seeing AI as a magical tool that will solve everything and go back to the fundamentals,” he said.

The EU has passed laws intended to force critical industries and product manufacturers to get those fundamentals right. But France, for example, is lagging in implementing such national regulations, and there are few other incentives to get companies to do that difficult and costly work.

Still, the images of empty supermarket shelves could provide a new incentive. “It should serve as a kind of a wake-up call,” Enjolras said.

Émile Marzolf contributed to this report.