Trump, the collapse of the German coalition looms large when European leaders meet in Budapest

By Philip Blenkinsop and Krisztina Than

BUDAPEST (Reuters) – Donald Trump’s return to power and the collapse of Germany’s governing coalition will be key talking points at a meeting of nearly 50 European leaders and an EU summit in Budapest on Thursday and Friday to discuss support for Ukraine, migration and to discuss economic security and declining competitiveness of the EU.

European leaders have broadly congratulated Trump but face uncertainty over U.S. support for Ukraine against Russia’s invasion, the U.S. commitment to the NATO military alliance and the prospect of tariffs on their exports to the United States.

Adding to the uncertainty hanging over the Budapest meetings, Germany’s three-party government collapsed on Wednesday evening when Chancellor Olaf Scholz fired his finance minister, paving the way for a general election.

Some are also nervous about the summit plans of Hungarian Prime Minister Viktor Orban, who has been criticized by European Union colleagues for his trips to Moscow and Georgia during his country’s EU presidency and said he would pop champagne corks if Trump win.

Speculation about surprises that host Orban might deliver includes connecting leaders by video link with Trump, whose defeat of Democratic Vice President Kamala Harris in Tuesday’s election was celebrated by the right-wing nationalist Hungarian leader.

On the agenda of the first meeting, the wider European Political Community, which also includes non-EU states such as Britain, is an exchange that the European Commission says should see a renewed commitment to supporting Ukraine before the breakout sessions on migration and economic security.

The latter issue would involve closer supervision of foreign investments and more coordinated controls on the export and outflow of technologies to rivals such as China. US pressure for such checks could increase when Trump returns to the White House in January.

In the evening, the EU’s 27 leaders will discuss transatlantic ties as well as Georgia, where the ruling Georgian Dream party, seen as increasingly pro-Russian, won victory in the disputed Oct. 26 election. The EU has frozen Georgia’s membership bid over concerns about a democratic backsliding.

EU officials hope that the outcome of the EU leaders’ dinner session will be a joint position congratulating Trump and emphasizing the importance of good US-EU ties, while emphasizing that the EU has its own agenda and her desire to adhere to global trade rules.

Leaders could return to the issue for a more substantive discussion when they meet in Brussels in December, a senior EU official said.

The EU summit will conclude on Friday with a debate on the EU’s competitiveness, including a presentation by former European Central Bank chief Mario Draghi in the presence of his successor Christine Lagarde.

At the request of the European Commission, Draghi wrote a report on how the EU should keep its greening economy competitive amid challenges from China and the United States at a time of increasing global friction.

In his nearly 400-page report, Draghi said the bloc needed investments of 750 billion to 800 billion euros a year, but frugal EU countries have objected to the idea that some of this should come from joint EU funds.

(Reporting by Philip Blenkinsop, Andrew Gray and Krisztina Than; Editing by Mark Heinrich)