{"id":1667576,"date":"2026-03-05T15:40:00","date_gmt":"2026-03-05T20:40:00","guid":{"rendered":"https:\/\/bugaluu.com\/news\/?p=1667576"},"modified":"2026-03-05T15:40:00","modified_gmt":"2026-03-05T20:40:00","slug":"there-is-a-growing-willingness-by-europe-to-contribute-to-regional-security","status":"publish","type":"post","link":"https:\/\/bugaluu.com\/news\/there-is-a-growing-willingness-by-europe-to-contribute-to-regional-security\/1667576\/","title":{"rendered":"There Is A Growing Willingness By Europe To Contribute To Regional Security"},"content":{"rendered":"

There Is A Growing Willingness By Europe To Contribute To Regional Security<\/span><\/p>\n

\n

By Elwin de Groot, head of macro strategy at Rabobank<\/em><\/p>\n

Losing One’s Innocence<\/strong><\/p>\n

A degree of calm seemed to return to energy and financial markets yesterday, helped by tentative signs \u2013 reinforced by US and Israeli statements \u2013 that intensified military operations against Iranian targets are degrading Iran\u2019s air defense, missile, and drone capabilities. <\/strong>A US submarine sank an Iranian naval vessel off the coast of Sri Lanka, and, as noted in yesterday\u2019s Global Daily, Kurdish forces appear to have already made limited incursions into Iranian territory.<\/p>\n

\u2b55\ufe0fThis is a crucial indicator of Iran’s remaining and degraded capabilities. There has been a consistent and steep daily decline in the number of launches from Iran. pic.twitter.com\/GuDmjsSYAs<\/a><\/p>\n

\u2014 Raylan Givens (@JewishWarrior13) March 3, 2026<\/a><\/p>\n

Still, there is no clear evidence that the regime is nearing collapse. Both Israel and the United States have signalled that their operations will continue for several more weeks<\/strong>. Given the \u201cfog of war,\u201d any firm conclusions would be premature. Indeed, the closure of the Strait of Hormuz \u2013 even if it appears to be a narrow maritime problem \u2013 could trigger<\/a> a cascading, system\u2011wide global crisis because modern civilization is built on deep, fragile interdependencies. What begins as an energy supply disruption can rapidly spread through petrochemicals, fertilizers, food production, metals, electricity grids, semiconductors, and ultimately state finances and even public order.<\/strong><\/p>\n

Oil prices are stabilizing in a range of $80\u201385 per barrel, while the European gas benchmark fell below \u20ac50\/MWh after touching \u20ac65 on Tuesday. These moves are not easily tied to specific events, though Trump\u2019s announcement earlier this week \u2013 that the US would insure and secure shipping through the Strait of Hormuz \u2013 may have supported sentiment<\/strong>. European equities recovered about 1.5%, and government bond yields nudged lower yesterday, where UST\u2019s saw yields rise by 3\u20134 basis points across the curve. The decline in European yields was more than reversed in early trading today, after reports of new strikes on Iran dampened sentiment again.<\/p>\n

Following the attack on a Cypriot airfield earlier this week, NATO intercepted an Iranian ballistic missile launched toward Turkish airspace yesterday. Its apparent trajectory toward the strategic port of Ceyhan \u2013 home to a major oil terminal, highlights the widening risk. As the conflict drags on, the number of \u201cinnocent bystanders\u201d is likely to shrink.<\/strong><\/p>\n

Indeed, another noteworthy development is the growing willingness of European countries to contribute to regional security<\/strong>. EU foreign policy chief Kaja Kallas already said on Sunday that the EU would reinforce its Gulf naval mission, Aspides, to protect shipping. The list of countries announcing deployments \u2013 especially to Cyprus \u2013 is expanding and now includes France (taking a lead role), the UK, Germany, and Greece. <\/strong>Italy is coordinating but has not confirmed deployment, while Dutch media report<\/a> that the Netherlands is also sending a naval vessel.<\/p>\n

And, as European leaders try to find the right posture given the developments in the Gulf region, the EU is also trying to make further advancements in other parts of its strategic autonomy agenda. <\/strong><\/p>\n

First, the EU indicated it does not expect the US to raise its universal tariff on EU exports from 10% to 15% this week, despite Treasury Secretary Scott Bessent signalling the increase was imminent. According to Bloomberg, citing individuals familiar with the matter, the EU has received assurances that the US will maintain the 10% rate for the bloc. EU lawmakers have therefore kept the ratification process on hold pending further clarity from Washington and plan to reconvene on 17 March.<\/p>\n

A central question, however, is whether the US can legally offer preferential tariff treatment to any specific country or bloc. The current framework is being applied uniformly, and existing exemptions cover only narrow categories of goods. While legal interpretation is ultimately for experts, the statutory language behind Section 122 tariffs supports temporary, non\u2011discriminatory surcharges \u2013 not country\u2011specific relief. Any deviation could expose the administration to legal challenges, and if courts adhere to the original intent of Section 122 (addressing balance\u2011of\u2011payments risks), preferential exemptions may trigger broader complications.<\/p>\n

Given this backdrop, the EU\u2019s optimism should be treated cautiously. US \u201cassurances\u201d may simply suggest that alternative tariff mechanisms are being prepared. In the same CNBC interview, Bessent said he believes tariff rates will revert to their previous levels within five months, pointing to potential replacements under Sections 301 and 232.<\/p>\n

We published<\/a> an impact assessment on the new tariff environment for the Eurozone last week \u2013likely overshadowed by Middle East developments \u2013 and see no reason to revise our view that a 15% tariff could ultimately apply to EU exports as well.<\/p>\n

A second major development was the European Commission\u2019s adoption of the Industrial Accelerator Act, designed to rebuild Europe\u2019s industrial base, accelerate decarbonisation in strategic sectors, reduce external technological dependencies, and strengthen economic security and supply\u2011chain resilience. Recent volatility in fossil\u2011fuel markets reinforces the logic behind this push. The Act effectively serves as Europe\u2019s answer to the US Inflation Reduction Act, China\u2019s expanding industrial dominance, and the increasing weaponisation of economic dependencies seen last year.<\/p>\n

Strategic sectors initially targeted include steel, cement, aluminium, automotive, and net\u2011zero technology manufacturing, with the possibility of expanding to additional industries. The goal is to accelerate modernisation, boost clean\u2011tech adoption, and ensure sufficient EU\u2011based production capacity to reduce vulnerabilities. The Commission proposes three main channels to achieve this:<\/p>\n

\u201cMade in EU\u201d and low\u2011carbon requirements in public procurement to stimulate demand for EU\u2011produced clean industrial goods;
\n\tSimplified and faster permitting to reduce bureaucratic delays;
\n\tStricter screening of foreign investments, particularly in sensitive sectors.<\/p>\n

For investments above \u20ac100 million where a single non\u2011EU country controls more than 40% of global capacity in the relevant sector, the Act introduces additional obligations, including mandatory technology transfer, local\u2011content requirements, creation of high\u2011quality jobs, and ensuring at least 50% EU workforce participation. These measures are likely aimed at China.<\/p>\n

The Regulation now moves to negotiations between the European Parliament and the Council and may be amended. Politico warns<\/a> that with numerous last\u2011minute changes \u2013 including dropping certain industries \u2013 the legislation risks substantial revision before final adoption. Once in force, however, it could have significant implications for the affected sectors. That the EU is losing its economic innocence does not seem a far-fetched conclusion, we would argue.<\/strong><\/p>\n<\/div>\n

Tyler Durden<\/a><\/span>
\nThu, 03\/05\/2026 – 10:40<\/span><\/p>\n

\u200bhttps:\/\/www.zerohedge.com\/markets\/there-growing-willingness-europe-contribute-regional-security<\/a>\u00a0<\/p>\n","protected":false},"excerpt":{"rendered":"

There Is A Growing Willingness By Europe To Contribute To Regional Security By Elwin de Groot, head of macro strategy at Rabobank Losing One’s Innocence…<\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-1667576","post","type-post","status-publish","format-standard","hentry","category-news","wpcat-1-id"],"_links":{"self":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts\/1667576","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/comments?post=1667576"}],"version-history":[{"count":1,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts\/1667576\/revisions"}],"predecessor-version":[{"id":1667606,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts\/1667576\/revisions\/1667606"}],"wp:attachment":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/media?parent=1667576"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/categories?post=1667576"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/tags?post=1667576"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}