World
Analysis: Trump’s policies set to widen EU-US innovation gap
As the curtain falls on 2025, policymakers in Brussels have yet to decisively counter the negative economic impacts of two major developments: the trade deal struck between the European Union and the United States this summer, and President Trump’s so-called “Big Beautiful Bill”, a mammoth piece of domestic legislation with global economic implications.
The EU’s slow progress toward improving relative business conditions at such a volatile moment has left investors frustrated and looking elsewhere.
According to a report published this week by the European Round Table for Industry, the leaders of the bloc’s industrial giants are “alarmed at the lack of urgency in delivering on Draghi and Letta’s bold reforms to restore the business case for investing in Europe.”
The report also points to a survey of CEOs conducted in October, which shows that only 55% expect to stick to their investment plans. Even worse, a mere 8% intend to invest more in Europe than they planned to six months prior, in contrast with the 38% who will either invest less than previously intended or have put decisions on hold.
And most tellingly, the US now attracts more investment than originally planned by 45% of respondents.
The ‘carrot-and-stick’ approach
The Trump administration’s combination of supply-side economics and protectionism has converted the necessity of avoiding US tariffs into a massive financial incentive for foreign companies and multinationals to invest in the United States directly.
The Big Beautiful Bill, which Trump signed into law in July, formalised huge tax breaks and effectively guaranteed incentives to shift investments across the Atlantic. Namely, the 100% bonus depreciation for new machinery and factories, as well as the 100% immediate expensing of domestic research and development (R&D) costs, mitigating the expenses of moving production and innovation to the US.
Companies have until 1 January 2026 to finalize their decisions and collect retroactive benefits for capital deployed in 2025, but the conditions will remain the same next year.
To compound the EU’s growing inability to compete, the heavily criticised EU-US trade deal was agreed in the same month. The agreement de-escalated the transatlantic trade war of 2025 but it levied a 15% tariff on the vast majority of the EU’s industrial exports to the US, with an exemption from duties for most US-made goods bound for the EU market.
In addition, the EU committed to spending over €640 billion in US energy, investing more than €500 billion in the US economy and buying around €35 billion worth of US-made AI chips, until the end of President Trump’s mandate. Meanwhile, the United States made no similar pledges.
As for corporations, the choice became simple: relocate investment to the US, avoid the tariff and claim massive tax deductions.
The innovation gap in numbers
The R&D siphon is the most critical threat to Europe’s future competitiveness, as the Trump administration’s new incentives pull core innovation to the US.
In the most innovative industries, such as the AI and healthcare sectors, the numbers for 2025 already demonstrate the chasm between the EU and the US.
In the first three quarters of this year, private investment flowing into US AI companies exceeded €100 billion, with the US capturing over 80% of global AI funding. In contrast, the entire EU attracted just shy of €7 billion, according to the widely read State of AI Report 2025.
This severe 15-to-1 funding deficit means the technological future is being built and scaled primarily outside the EU, something that has been recognised by the European Parliament.
Likewise, the EU is aiming to achieve 20% market share in semiconductor manufacturing by 2030, as outlined in the Chips Act, but experts say such a goal is unlikely given that Europe is among the slowest growers in the sector year-on-year.
Furthermore, the EU is even falling behind on AI adoption among young users, according to a new survey by the Organisation for Economic Cooperation and Development.
As for the pharmaceutical industry, CEOs sent a stark warning to President von der Leyen back in April that “unless Europe delivers rapid, radical policy change then pharmaceutical research, development and manufacturing is increasingly likely to be directed towards the US.”
In the following weeks, fuelled by the fear of the ongoing transatlantic trade war at the time and frustration with the European regulatory scene, the third largest company in Europe by market capitalization, the Swiss-based Roche, committed over €40 billion in US investment over the next five years. Likewise, the French multinational Sanofi announced an investment of €17 billion to expand manufacturing in the US through 2030.
In July, as the Big Beautiful Bill and the EU-US trade deal were being agreed, the British-Swedish company AstraZeneca also declared investing over €40 billion in the US over the next five years, including the construction of a chronic disease research centre in the state of Virginia, the company’s largest single investment in a facility to date.
In November, the White House announced a large-scale agreement between two pharmaceutical rivals, the American manufacturer Eli Lilly, and the Danish corporation Novo Nordisk, known for pioneering the prescription drug for type 2 diabetes, Ozempic, which has also been widely used off-label for weight loss.
The two companies agreed a strategy to reduce the prices of several medications for Americans and announced new investments in the US, with Novo Nordisk committing roughly €8.5 billion to expand US manufacturing capacity. In exchange, the Danish company is expected to receive a three-year exemption from US tariffs, among other benefits.
In total, the European pharmaceutical industry has pledged more than €100 billion for US expansion in 2025 alone with multi-year commitments.
The scramble to deregulate
The pressure applied by the US is evident as this year has seen the European Commission pivot to an aggressive deregulation agenda.
In response to a request from the European Council, six simplification proposals, referred to as “omnibuses”, have been presented since February covering energy, finance, agriculture, technology, defence and chemicals.
Notably, the so-called Digital Omnibus was introduced in November, and it includes delays to provisions of the AI Act and modifications to the GDPR.
These initiatives aim to rapidly cut red tape and reduce bureaucratic costs for European businesses in an attempt to stem the outflow of talent and capital. However, the proposed measures are still facing legislative scrutiny, as well as administrative oversight and political backlash from privacy and climate advocates, among others.
It was only this week that an agreement was finally reached on the first omnibus, another sign that the EU is still far from offering the immediate financial certainty of minimising or avoiding US tariffs while benefiting from President Trump’s policies where possible.
The numbers reveal the plain economic truth: while the EU debates the fine print of deregulation, the investment in innovation is already being decisively relocated.
World
Natasha Lyonne Posts Health Update Two Months After Relapse: ‘Doing a Whole Lot Better and Back on Her Feet’
Natasha Lyonne is thanking fans for their support after she revealed in January that she had relapsed and was no longer sober. “Proud to report this kid is doing a whole lot better and back on her feet,” she wrote.
“Want to thank our recovery communities and the fans who stood by and were so supportive. Aiming to keep the journey somehow private, but look forward to sharing my experience, strength and hope as makes sense.”
Lyonne struggled with addiction to drugs and alcohol throughout the 2000s.
After attending the Sundance Film Festival in late January, the “Poker Face” star wrote that she had relapsed and then added, “Recovery is a lifelong process. Anyone out there struggling, remember you’re not alone. Grateful for love & smart feet. Gonna do it for baby Bambo. Stay honest, folks. Sick as our secrets. If no one told ya today, I love you. No matter how far down the scales we have gone, we will see how our experience may help another. Keep going, kiddos. Don’t quit before the miracle. Wallpaper your mind with love. Rest is all noise & baloney.”
“Poker Face” was canceled at Peacock in November, though Lyonne and producer MRC were shopping a new version that would star Peter Dinklage as the bullshit-detecting detective.
Lyonne has several feature projects in the works: She is set to write and direct the indie film “Bambo” about a New York boxing promoter and was previously set to make her directing debut with “Uncanny Valley,” produced by her AI film studio Asteria Film Co.
World
Ukraine peace talks on ‘situational pause’ as Middle East conflict intensifies: Kremlin
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Ukraine peace talks are on a “situational pause” as the Middle East conflict intensifies, the Kremlin said Thursday, even as Kyiv signaled negotiations could resume as soon as this weekend.
Following reports in Russian media that the Kremlin had paused talks on Ukraine and that the Middle East conflict could push Kyiv toward compromise, Kremlin spokesperson Dmitry Peskov confirmed the pause.
“This is a situational pause, for obvious reasons,” Peskov told reporters when asked about the report, according to Reuters.
Peskov added that as soon as “our American partners” could refocus on the Ukraine conflict, Moscow hopes the pause will end and new talks can begin, the outlet reported.
UKRAINE TO MEET TRUMP ENVOYS AHEAD OF HIGH-STAKES GENEVA TALKS WITH RUSSIA AS WAR ENTERS FIFTH YEAR
Ukrainian President Volodymyr Zelenskyy speaks during a briefing in Kyiv, Ukraine, Saturday, Jan. 3, 2026. (Danylo Antoniuk/AP)
Ukrainian President Volodymyr Zelenskyy said in a video posted on X that Kyiv has received signals from the U.S. that it is ready to resume talks aimed at ending the war.
“There has been a pause in the talks, and it is time to resume them,” he said. “We are doing everything to ensure that the negotiations are genuinely substantive.”
Zelenskyy added that a Ukrainian negotiating team is already on its way to the U.S. and is expected to hold meetings Saturday.
RUSSIA, UKRAINE TO DISCUSS TERRITORY AS TRUMP SAYS BOTH SIDES ‘WANT TO MAKE A DEAL’
Firefighters put out the fire in the ruins of an apartment building following Russia’s missile attack in Kharkiv, Ukraine, Saturday, March 7, 2026. (AP Photo/Andrii Marienko)
Earlier this month, President Donald Trump said the “hatred” between Russia and Ukraine was getting in the way of reaching a peace deal.
Speaking at the Shield of the Americas Summit in Doral, Florida, Trump said the “hatred between Putin and his counterpart is so great.”
“It’s so great that, you know, Ukraine, Russia, you’d think there would be a little bit of camaraderie, [but] there’s not. And the hatred is so great. It’s very hard for them to get there. It’s very, very hard to get there. So we’ll see what happens,” Trump said. “But we’ve been close a lot of times and one or the other would back out.”
UKRAINE’S ZELENSKYY: RUSSIA TRYING ‘TO PLAY’ GAME WITH TRUMP, STALL PEACE TALKS
U.S. President Donald Trump and Ukrainian President Volodymyr Zelensky shake hands at a news conference following a meeting at Trump’s Mar-a-Lago club on December 28, 2025 in Palm Beach, Florida. (Joe Raedle/Getty Images)
Trump’s comments came after NATO Secretary General Mark Rutte said in January that Russia was losing between 20,000 and 25,000 troops each month in its war against Ukraine.
The pause in talks comes as Ukraine is increasingly being drawn into the wider Middle East conflict.
With the conflict in Iran now in its third week, Ukraine is providing technology and battlefield-tested tactics to counter Iranian drone attacks.
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U.S. and Gulf partners have requested Ukrainian assistance, with Kyiv signaling it is prepared to share both systems and personnel to help defend against Iranian aerial threats.
Fox News Digital’s Greg Norman-Diamond and Morgan Phillips contributed to this report, along with Reuters.
World
‘Nobody can blackmail us’: Leaders excoriate Orbán’s veto
Fury over Viktor Orbán’s decision to veto the European Union’s €90 billion loan for Ukraine burst into the open on Thursday as leaders castigated, one by one, in the harshest terms yet, the “unacceptable” behaviour of the Hungarian prime minister.
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The condemnation was led by António Costa, the usually mild-mannered president of the European Council, whose authority is being directly challenged by Orbán’s disruption.
“The leaders took the floor to condemn the attitude from Viktor Orbán, to remember that a deal is a deal and all the leaders need to honour that word,” Costa said at the end of the summit, venting months of frustration over the antics of the Hungarian.
“Nobody can blackmail the European Council. Nobody can blackmail the European Union institutions,” he told reporters after being questioned by Euronews, insisting that the loan will be paid out as agreed last December. Still, Orbán doubled down on his veto.
Separately, Costa praised Ukraine’s efforts to repair the Druzhba pipeline and allow an EU-led inspection on site in line with demands by Hungary and Slovakia just days before the summit, despite the fact that President Volodymyr Zelenskyy said he was personally against reinstating transit of Russian oil through Ukraine as the war continues.
Orbán insists that Ukraine has purposely sabotaged the pipeline to orchestrate an energy crisis ahead of a tight election on April 12. Zelenskyy says the allegation is unfounded but has also lashed out in public at Orbán in multiple occasions.
Costa, according to a diplomat, said both must tone down the rhetoric, but also noted that Hungary is putting on the table impossible conditions, such as ensuring the safety of transit, while Russia keeps pounding Ukraine with missiles and drones.
“This is not acting in good faith, when you put a condition that neither the European Union nor the member states can ensure,” Costa said.
“Because only Russia is willing to decide if they try again to destroy the Druzhba pipeline,” he added, noting Moscow has attacked it more than 20 times since 2022.
“And of course, it is not the responsibility of Ukraine, the Commission, the European Council or any member state.”
In an effort to break the impasse, Brussels announced two days before the summit that Ukraine had allowed an external inspection and the EU would provide funding to fix the pipeline. But the pressure on Zelenskyy to approve the on-site mission failed to get the Hungarian leader to change his mind.
And it now poses a direct threat to the credibility of the institutions, the functioning of the EU and the top leadership from Costa to Commission chief Ursula von der Leyen.
On Thursday evening, von der Leyen said Hungary, alongside Slovakia and the Czech Republic, agreed at the highest political level to go ahead with the loan in December in exchange for being financially exempted.
“That condition has been fulfilled. So let us be clear about where we stand: the loan remains blocked because one leader is not honouring his word,” she said.
“But let me reiterate what I already said in Kyiv: we will deliver one way or the other.”
German Chancellor Friedrich Merz also accused Orbán of an “act of serious disloyalty” that should be prevented in the future, changing voting rules if necessary.
French President Emmanuel Macron called for the December deal to be respected and warned that concerns about energy security “must not be instrumentalised”.
Sweden’s Ulf Kristersson, Austria’s Christian Stocker and Belgium’s Bart De Wever were among those who criticised Orbán for exploiting the dispute with Kyiv for his re-election campaign, which has taken an explosive tone in its final stretch.
High Representative Kaja Kallas went further, questioning the motivations of the veto and the Hungarian arguments: “I guess, in the time of elections, people are not that rational.”
No backing down
A roundtable session described as “heated and tense” by diplomats was not enough to get Orbán to back down. If anything, he doubled down. And leaders quickly understood the veto will most certainly remain until the Hungarian elections take place.
After the summit, the Hungarian leader went a step beyond and suggested Brussels is working with Ukraine to force a pro-Brussels government in Budapest.
“The European institutions, including parts of the Commission and the European Parliament, would like to have a change of government in Hungary. And they finance it,” he said as he departed the meeting.
The accusations are not new, but they are serious as they imply political meddling. As the campaign enters its final weeks, Orbán is intensifying his attacks on his opponent, Péter Magyar, as a puppet candidate of von der Leyen and Zelenskyy.
Before leaving Brussels, he vowed to “no money for Ukraine” until the oil flows are back and claimed he “had defended the Hungarian national interest by breaking the blockade”.
The Hungarian veto comes at a precarious time for Europe.
The United States, under President Donald Trump, has cut off all assistance to Ukraine, leaving Europeans to pick up the tab alone.
The €90 billion loan agreed in December, following contentious talks among leaders, serves as the backbone of Ukraine’s budget needs for 2026 and 2027. Without it, Ukrainian authorities have warned they may not be able to make ends meet, and that could have serious repercussions on the battlefield.
Under the original plan, Kyiv was supposed to receive the first payment in early April to avoid a sudden cut-off in foreign assistance. But the veto, coupled with the Hungarian vote, has thrown that timeline into disarray.
Although opinion polls show Orbán trailing Magyar by double digits, he could still win as the gap narrows ahead of the vote and prolong the veto even further.
To make matters more difficult, Slovak Prime Minister Robert Fico, whose country is also connected to Druzhba, has warned that he will continue the blockage if Orbán loses the elections and the pipeline is not repaired.
The dispute poses an exceptionally complex challenge for Brussels, which is caught between safeguarding energy security for member states and supporting Ukraine.
For António Costa, the person tasked with ensuring that decisions taken by EU leaders are upheld, Orbán’s defiance threatens to undercut his authority.
“It’s completely unacceptable what Hungary is doing,” Costa said on Thursday. “And this behaviour cannot be accepted by the leaders.”
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