What to expect from the European elections 

  • With an expected 60% participation rate, the 2024 EU elections are set to be a pivotal moment for the European Parliament. Addressing poverty (33%) and public health (32%) are voters’ top priorities, according to the April 2024 Eurobarometer survey, while the top five topics that emerge from political parties’ manifestos are climate and energy, security and defense, competitiveness and growth, foreign policy and fiscal and industrial policies. We expect the main centrist parties to still secure a majority of the 720 seats, but right-wing parties are likely to secure more support, which could alter the EU's legislative priorities and overall direction on some topics, notably security and defense. 
  • The next EU Commission should prioritize enhancing EU competitiveness, revamping foreign policy on trade, fortifying defense and security, addressing climate change and strategizing fiscal policies. To boost competitiveness, the EU needs to foster a culture of innovation, increase investment in R&D and embrace digitization and AI to drive productivity gains. On foreign policy, the EU needs to focus on its strength in trade and strive for a dual strategy of new FTAs and smaller bilateral agreements on specific topics that are easier to reach but often important in impact. On defense and security, policies must adapt to a changing security landscape and reallocate resources from within the EU budget to common defense spending. Meanwhile, fiscal policy needs to become more strategic with a long-term vision that supports strategic industries, economic stability and growth through counter-cyclical spending and taxation policies as well as structural reforms for upcoming investment needs related to the climate transition (more than 3% of GDP) and defense and security (above 2% of GDP).
  • The EU also needs to strive for a truly integrated Single Market in energy, telecommunications and the financial sector. A Capital Markets Union has never been more urgent as competition for capital intensifies amid higher interest rates and immense investment requirements. While single supervision remains out of the scope, measures to reduce the regulatory burden, improve financing conditions for EU businesses by reviving the securitization market, harmonize insolvency law, accounting practices, listing requirements and strengthen supervision are crucial.
  • On climate policy, after the great leaps of the European Green Deal and Fit for 55, the next five years should be all about implementation. However, the energy market still needs a clear plan. Over the last five years, the EU has embarked on a transformative journey with the implementation of a comprehensive European Green Deal and Fit for 55, aimed at reducing net greenhouse gas emissions by at least -55% by 2030 compared to 1990 levels (currently at -32%), positioning itself as a leader in the global fight against climate change. This sets the stage for the years to come and current items on the agenda need implementation, so we do not expect any further big reforms on the climate front. However, the energy market still needs a clear plan, i.e. a truly European grid plan. After long negotiations, the EU Council enacted the long-awaited electricity and gas market reforms in May 2024. Unfortunately, it falls short on several key aspects and does not deliver harmonized and long-term focused EU electricity market framework. 
Ana Boata
Allianz Trade
Jasmin Gröschl
Allianz SE
Markus Zimmer
Allianz SE