Inside Costa’s EU budget push
GREETINGS. It’s Nick Vinocur. Let’s dive in:
— What should be the focus of EU leaders ahead of their AI gathering in Dublin.
— Why the bloc is still talking about an ethics body, two years after Qatargate.
On today’s Brussels Playbook Podcast: Zoya and Nick consider whether the EU and Canada’s new “closest possible” relationship can survive 27 capitals, a six-month reality check and the Le Pen test.
**A message from HEINEKEN: What does it take to build a more competitive Europe from the ground up? On 4 November, Beyond the Glass: Brewing Local Competitiveness will bring together policymakers, business and hospitality leaders to explore how long-term investment and strong local value chains can help Europe’s businesses and communities thrive.**
COSTA GRABS THE WHEEL ON BUDGET NEGOTIATIONS: European Council President António Costa kicks off a crucial behind-the-scenes push this week to bring countries closer to a deal on the EU’s long-term budget, EU officials told me and Gregorio Sorgi.
The real deal: This week’s meetings are a test of Costa’s ability to strike deals, after he faced criticism from some governments for hosting an unwieldy EU summit last month. Several leaders say the time is now right to strike a deal before looming elections in France, Italy and Poland threaten to derail talks.
Taking over the reins from Ireland, which holds the EU’s rotating presidency, Costa’s chief of staff Pedro Lourtie will use closed-door meetings in Brussels’s Europa building, dubbed “confessionals,” to sound out the 27 capitals on possible budget cuts and compromises. “The purpose … is to indicate the direction of travel and hear the feedback of member states,” an EU official close to Costa told Gregorio.
Padre Pedro: Lourtie will come equipped with “different scenarios” — i.e., simulations of how various nips, tucks and taxes could affect the overall package — to test countries’ responses, an EU diplomat said. Costa invited leaders’ sherpas alongside their EU ambassadors to add political heft to the discussions, according to two EU diplomats. This will help Costa’s team work toward an official negotiating document to be presented before a gathering of leaders in Brussels on Nov. 26 — a meeting that will be devoted to the 2028-2034 budget.
Pick your tax: Costa’s budget brains and the Commission are testing the waters on potential new EU-wide taxes, or own resources. One of the new ideas on the table is to funnel revenue from a global tax on multinational corporations to fund the EU budget.
Pleasing Paris: Generating money from own resources is notably a key ask from France, whose Europe Minister Benjamin Haddad told Playbook: “The key to this [EU budget] equation is own resources. They are a sine qua non condition for us.”
Indeed, after President Emmanuel Macron said he would have to sign off on a deal after year-end, Costa’s mission is partly to give the French president a win to pave the way for a broader deal by December, according to two other EU diplomats.
Brace: Summit season starts next week with an informal meeting in Ireland where, despite a primary focus on AI, leaders are expected to discuss the budget on the sidelines.
To lay the foundation for a deal, two diplomats floated the possibility of a three-way meeting between Macron, German Chancellor Friedrich Merz and Italian Prime Minister Giorgia Meloni.
The bottom line: This push to find a “landing zone” for the next budget may be the biggest test yet of Costa’s dealmaking skills — or what one diplomat called “the real thing.”
NATO FEARS GROW AHEAD OF U.S. MIDTERMS: European allies fear a Republican Party defeat could spur President Donald Trump to dramatically step up his attacks on the alliance, according to NATO diplomats.
ENDORSEMENT FALLOUT: The decision by Democrat lawmaker Haley Stevens to endorse Republican Mike Rogers in the Michigan Senate race has sparked calls within her party to have the congresswoman ejected from the Democratic caucus. Meanwhile, Tump has held the last of his in-person midterm rallies.
EU FLEXIBLE ON TERMS IF U.K. REJOINS: Brussels would be flexible on letting Britain stay out of the euro and the Schengen Area if London applied to rejoin the European Union, two EU officials familiar with the bloc’s approach have told POLITICO.
EU-CANADA’S SIX-MONTH TEST: Brussels and Ottawa have agreed to build the closest possible relationship, but over the next six months they’ll need to define what that means, Zoya Sheftalovich reports.
HOW RFK IS SHAPING EU FOOD POLICY: U.S. Health Secretary Robert F. Kennedy Jr has alarmed Brussels with his anti-vaccine broadside, but his crusade against mass-produced munchies has found an ally in the European Commission.
YOTOVA WINS BULGARIAN POLL: Incumbent President and former MEP Iliana Yotova has won Bulgaria’s presidential election with 57% of the runoff vote, in an outcome that will strengthen Prime Minister Rumen Radev’s grip on power, Bloomberg reports.
POLISH COURT CRISIS: Polish Foreign Minister Radosław Sikorski has told French far-right leader Marine Le Pen to stop intervening in Polish politics after she voiced concern about the government’s clash with the constitutional court. The European Commission has thrown its support behind the government of Prime Minister Donald Tusk.
HOMEWORK FOR EU LEADERS PREPPING AI SUMMIT: As EU leaders gear up for their first top-level huddle on AI in Dublin next week, Norway’s Deputy Foreign Minister Andreas Motzfeldt Kravik has some advice: Either focus on deliverables, like a shared system for reporting AI incidents, or risk discussions getting bogged down.
Why him? Kravik, who spoke to Playbook en route to New York for international AI talks, is on the front line of shaping global AI guidelines. He’s traveled the world in an attempt to forge a broad consensus on the matter.
It’s the security, stupid: “I think the question we have is: Will there have to be a major incident before countries understand that there needs to be some sort of discourse at the international level, some kind of rule-setting at the international level?” asked Kravik.
What he means: Incidents of AI models “breaking out” of their testing environments, in some cases hacking rival companies, could be just a prelude to bigger, far more damaging incidents. At the very least, he argued, countries need a system where such incidents can be reported quickly and transparently — not unlike how states alert disease outbreaks to the World Health Organization.
Tough, but still needed: Some 30 countries including Norway, Canada, South Africa and several EU states have signed a “call to action” on AI safety. But agreements on international principles are in their infancy. “It’s like trying to set aviation standards in the 1920s,” said Kravik, referring to a time when aviation was still emerging as a viable technology and thus difficult to regulate.
An added obstacle: Fierce competition between the U.S. and China and … critics who argue AI needs no special rules. “Some colleagues, also in the U.S., will say: ‘Well, we have liability rules,’ ” he said. But suing a company post-harm isn’t enough, Kravik argued, pointing to extensive regulation in pharmaceuticals.
Focus on convergence: Talks among dozens of countries have already identified some key areas of convergence, namely around incident-reporting and testing of AI models. EU leaders may want to take that experience into account when they gather in Dublin.
The U.S. is pressing Lithuania to open a port to allow potash to be exported from Belarus, despite European sanctions. But what is potash and why does the U.S. want it? It’s a potassium-rich mineral that’s a primary element in fertilizer (it can also be used in glass manufacturing and to make soaps and detergents). American farmers have reported higher fuel and fertilizer costs, squeezing already tight profit margins, which is a problem for Trump ahead of the midterms.
TALK TO PLAYBOOK: On the Brussels Playbook Podcast, Zoya asked for your ideas on what to call the EU-Canada relationship. WhatsApp us on +32 491 050629 and listen from 7 a.m. to hear if we give you a shout-out.
EU ETHICS BODY SAGA CONTINUES: In the wake of the Qatargate scandal, the European Parliament pushed other institutions to create a common EU ethics body. Two years on, the Parliament is undecided on whether to kill the entire thing.
Recap: The right-wing majority in the Parliament is blocking the creation of the ethics body, but the legislature’s legal service says the institution is bound by a 2024 agreement to set it up. So it’s up to President Roberta Metsola and political group leaders to break the deadlock.
Frozen: Metsola has yet to put the issue on the agenda, even as Parliament approved the body’s budget and appointment of experts to staff it. A Parliament official said group leaders won’t discuss the issue until the Council sends an invitation to the body’s inaugural meeting.
“The president has always consistently moved the process forward,” a spokesperson for Metsola said. “The Council presidency is now in the chair and the Parliament will of course attend any meeting they call.”
Catch-22: Yet the Council wants reassurances from Parliament before it calls a meeting, which “is by its nature political and requires a commitment from the governance tier of all of the institutions,” said an EU diplomat. “This is what Parliament committed itself to and what its partners expect.”
A second frustrated diplomat said the Parliament “certainly needs” a body, pointing to the numerous scandals it has faced.
Midterms reshuffle: Three officials said the Parliament is keen to push the issue until after the midterm reshuffle to avoid inflaming tensions between the European People’s Party and the Socialists and Democrats.
FRANCE EYES CHUNK OF U.K. NUCLEAR: Four industry figures familiar with nuclear planning in Whitehall say EDF Group-owned company Framatome is bidding to purchase land at Oldbury, in southwest England.
U.K.-GERMANY DEFENSE HEADWINDS: British Defence Secretary Wes Streeting is in Berlin today to discuss closer military cooperation with Germany, as internal German briefings point to a tough choice ahead on how the two sides can work together.
BRUSSELS EYES QUANTUM LEAP: A perennial also-ran in the global AI race, Europe now sees an opportunity to win what promises to be another technological revolution by learning from its mistakes, Pieter Haeck reports.
RUSSIA AND UKRAINE CLAIM APP HACK: Ukraine’s public air raid alert app was hacked on Sunday, with Kyiv and other areas issued nuclear and chemical alerts, the Ukrainian Air Force said. Russia also claimed its emergency app had been hacked.
ABOUT A TRUMP PHARMA RESET: Some Europeans hope that midterm elections in the U.S. may ease Trump’s push to lower EU drug prices — but the president is just as likely to intensify his demands.
FORMER IRISH MEP DIES: Former Fianna Fáil minister and MEP Gerry Collins has died at the age of 88, the Irish Times reports. Collins was a member of the European Parliament between 1994 and 2004.
WEATHER: Cloudy, with showers throughout the day and a top of 11C.
LIGHTS, CAMERA, EU POLICY: Who said Brussels debates only happen in conference rooms? A recent initiative called “Films & Politics,” launched by the platform Newframes, is using cinema to spark conversations about politics and society. Playbook’s Gerardo Fortuna caught up with co-founder and film producer Claire Montadon and Social Media Manager Leslie Musimenta to hear more.
Not your usual Brussels panel: Every month, Newframes screens a film, usually at La Tricoterie in Saint-Gilles, followed by a debate with journalists, activists, diplomats and other bubble dwellers. “The bubble likes it because it’s different, unusual for them and more intimate,” Musimenta said.
A little disagreement never hurts: Audiences submit questions via QR code, with a break halfway through to mingle — or cool down — before the debate resumes. “There can be frictions and disagreements,” Musimenta acknowledged. But that’s rather the point: Montadon sees the initiative as an antidote to growing polarization.
Coming soon to a screen near you: On Nov. 30 there will be an advance screening of “Gates of Europe,” a documentary made with three years of access to EU border agency Frontex. A special showing will kick-start a discussion on how Europe’s border policies work in practice — and who they affect.
And the Oscar goes to … Brussels? Newframes has bigger ambitions: to prepare its International Film Festival of Advocacy, planned for June 8-12 across several Brussels venues, complete with awards and a program still in the works. Montanan wants it to become the “main film festival of advocacy,” attracting filmmakers from around the world. And why Brussels? “No other city brings together all the audiences like Brussels,” she said.
Berlin: Germany still needs the CDU but the party must provide a new rationale for its existence, according to Chancellor Friedrich Merz.
Paris: Former Prime Minister Edouard Philippe has ruled out taking part in a broad centrist primary, arguing it would lead to “divisions” and “confusion.”
Madrid: Returns tomorrow after the All Saints public holiday.
London: Home Secretary Shabana Mahmood unveils details of controversial changes to migration rules, in a test of PM Andy Burnham’s grip on his party’s left wing.
Read more from our Playbook family: Washington … Ottawa … Canberra.
— EU foreign policy chief Kaja Kallas meets U.K. Defence Secretary Wes Streeting and hosts the EU–U.K. Security and Defence Dialogue in Brussels at 9:15 a.m. Watch here.
— Streeting also meets German Defense Minister Boris Pistorius in Berlin. Joint press statement at 5.15 pm.— Agriculture Commissioner Christophe Hansen visits the Farmus Agriculture apple orchards, meets Turkish Agriculture and Forestry Minister İbrahim Yumaklı and takes part in the EU–Türkiye High-Level Dialogue on Agriculture in Ankara. — European Commission President Ursula von der Leyen hosts European startup CEOs and sustainability stakeholders for a working dinner in Brussels. — Financial Services Commissioner Maria Luís Albuquerque delivers a keynote speech and takes part in a fireside discussion at the Central Bank of Ireland’s Financial System Conference 2026, in Dublin. — Environment Commissioner Jessika Roswall delivers a keynote address at EU Days Lund and visits the Vattenhallen Science Centre and Tetra Pak at Lunds Tekniska Högskola in Lund at 10:30 a.m.
MEPs Marlena Maląg, Tomáš Zdechovský, Elena Kountoura and Romana Tomc; former MEPs Mihai Ţurcanu and Elena Gentile; EU Ambassador to Israel Michael Mann; French politician Pieyre-Alexandre Anglade; former Slovenian President Borut Pahor; AP’s Barbara Šurk; BBC’s Anthony Zurcher; Sarah Elliott from The Hamilton Society; Centre for European Reform’s Camino Mortera-Martinez.
Playbook is brought to you by POLITICO’s EU Politics team: Gerardo Fortuna, Nicholas Vinocur, Gabriel Gavin, Zoya Sheftalovich, Max Griera, Mari Eccles, Hanne Cokelaere, Lucia Mackenzie, Gregorio Sorgi and Sebastian Starcevic. And: reporters Milena Wälde and Daria Zakharova, editors Alex Spence and James Panichi, and producers Dean Southwell and Hugh Kapernaros.
**A message from HEINEKEN: Europe’s competitiveness not only depends on emerging industries and innovation hubs, but also on the farms, breweries, supply chains, cafés, pubs and restaurants rooted in communities across the continent. At Beyond the Glass: Brewing Local Competitiveness on 4 November, HEINEKEN and POLITICO will bring together HEINEKEN Europe President Glenn Caton, MEP Tomáš Zdechovský, Sybren Fennema of Steward Redqueen and hospitality entrepreneur Pedro Ruiz Ocejo to discuss what it takes to support local businesses and strengthen Europe's competitiveness. Moderated by POLITICO’s Julia Wehrle, the discussion will examine what businesses need to keep investing, how hospitality contributes to prosperity and social connection, and how policymakers and industry can create practical, responsible conditions for long-term growth.**
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