Global Risk Indexes (24-02-2025)

Global 99 (0 —)
MENA 99 ( —)
APAC 98 ( —)
Europe 99 ( —)
Africa 98 ( —)
AMERs 98 ( —)
Markets 99 ( —)
Markus Schmidt, Europe region analyst at Worldwise Analytica

Markus Schmidt

Analyzing Today, Anticipating Tomorrow

Europe at a Crossroads: U.S.-Russia Talks Sideline the EU, German Elections Shake the Political Landscape, and Security Risks Mount

Washington’s peace negotiations with Moscow are sidelining Europe, heightening fears of a settlement that weakens NATO. U.S. and Russian officials are preparing for another round of high-level talks to discuss ending the war in Ukraine—without Kyiv or its European allies present. The potential for an imposed settlement that cements Russian territorial control over occupied regions has alarmed European policymakers, who see their strategic interests being undermined. With Trump’s administration prioritizing a transactional approach, Europe risks being reduced to an observer in the continent’s most significant security crisis since World War II.

Germany’s political shift deepens EU uncertainty. For the first time since 1945, a far-right party, the AfD, has secured second place in a national election. Although mainstream parties have formed a ‘firewall’ to prevent AfD from entering government, the party’s rise reflects deepening discontent over immigration, economic stagnation, and German sovereignty. Meanwhile, Friedrich Merz’s CDU victory signals potential changes in Germany’s foreign policy, with Merz criticizing U.S. interference and calling for ‘real independence’ from Washington. This shift could alter the EU’s approach to transatlantic relations, defense policy, and the future of NATO.

The U.S.-EU trade war is escalating, adding economic strain to an already fragile Europe. With Trump refusing to negotiate tariff exemptions, European businesses face severe disruptions. German industrial leaders warn that the latest round of tariffs could push Europe’s largest economy into a prolonged recession. Meanwhile, investor confidence remains weak, with concerns over Europe’s ability to maintain economic stability amid worsening relations with Washington.

Ukraine is facing the largest drone attack of the war, signaling a new phase in Russian military aggression. Over 200 drones targeted Ukraine overnight, causing significant damage across multiple regions. With Russia intensifying its air campaign, Ukraine’s air defenses are being stretched thin. The attack comes as President Zelenskiy urges European allies to remain united, warning that any U.S.-Russia deal that excludes Ukraine would be a ‘betrayal of European security.’

Russia’s hybrid warfare campaign against Europe is expanding. Italian financial institutions have suffered another wave of cyberattacks, while suspected Russian operatives are increasingly active in Germany, Poland, and the Baltic states. Energy security remains a top concern, with continued Russian sabotage attempts against European infrastructure. The EU has announced a new cybersecurity initiative, but experts warn that Europe remains highly vulnerable to Russian asymmetric tactics.

NATO’s future is in question as European leaders openly debate strategic autonomy. German Chancellor-in-waiting Friedrich Merz has questioned whether NATO will remain ‘in its current form’ by June, given the Trump administration’s shifting stance. His remarks echo growing fears across European capitals that the U.S. may scale back its security commitments, forcing Europe to take greater responsibility for its defense. The debate over a NATO peacekeeping force in Ukraine continues to gain traction, though the risks of direct confrontation with Russia remain high.

The U.S. is attempting to push its own Ukraine resolution at the U.N., bypassing European proposals. Washington’s draft resolution avoids mentioning Russia’s aggression, instead calling for a vague ‘lasting peace.’ European diplomats have voiced frustration, seeing this as another sign that Trump’s administration is prioritizing expedient diplomacy over European security concerns. If the U.S. continues to sideline European allies at the U.N., it could lead to a further fracture in transatlantic relations.

Europe is entering a period of profound geopolitical realignment. The coming weeks will determine whether the continent can assert its strategic autonomy or remain at the mercy of external power struggles.

Geopolitical Risk Assessment for the Europe
(24-02-2025)

Europe is confronting an unprecedented strategic crisis as the U.S. accelerates peace talks with Russia, marginalizing European input. The German elections mark a significant political shift, with the AfD securing second place for the first time since World War II, while Friedrich Merz's CDU victory signals a potential recalibration of Germany’s foreign policy. The U.S.-EU trade war is worsening, compounding Europe’s economic difficulties. Meanwhile, Russian hybrid warfare, energy security threats, and Ukraine’s escalating conflict continue to destabilize the continent. With NATO facing existential questions and European leaders increasingly voicing concerns about U.S. reliability, the need for Europe to assert its strategic autonomy has never been greater.

Geopolitical Risk Index

Developments to Follow for the Europe (See All Global)

Previous Briefings

See all previous briefings