Screening of investments to be mandatory for all member states in sensitive sectors such as defence, financial services and semiconductors

New regulation is crucial to the EU’s economic security

Improved cooperation mechanism among Member States and harmonisation of procedures

European Commission to set conditions on foreign investments

On Tuesday, Parliament approved new EU rules for the screening of foreign investments to prevent security risks.
With 508 votes in favour, 64 against and 90 abstentions, MEPs gave their green light to an agreement with EU member states on the mandatory screening of foreign investments in sensitive sectors such as defence, semiconductors, artificial intelligence, critical raw materials and financial services, in order to identify and address potential security or public order risks while remaining open to foreign capital inflows.
The procedures applicable to national screening mechanisms will be streamlined, to reduce complexity and make the EU a more attractive place to invest. Cooperation among national screening authorities and with the Commission will be enhanced, facilitating coordination and joint action on cross-border security risks. The new law will also cover transactions within the EU where the investor is ultimately owned by individuals or entities from a non-EU country.
It was also agreed that further action at Union level is needed to address economic security risks resulting from foreign investments. The Commission also committed to take the initiative on setting the conditions for foreign investment in specific strategic sectors. The Commission delivered on this commitment by submitting a legislative proposal for an Industrial Accelerator Act on 4 March 2026.
Parliament’s rapporteur Raphaël Glucksmann (S&D, FR) said:“ With this text, we are closing a chapter of European naivety. Certain foreign states are seeking to weaken us. We are turning the page on the wilful blindness of Member States that allowed foreign actors to seize control of sensitive sectors of our economy. But our work on foreign investment is not finished – the fight for Europe’s independence and sovereignty continues, now with the proposed Industrial Accelerator Act.”

Background
The current foreign direct investment screening regulation entered into application on 11 October 2020. Following an evaluation of its functioning, the Commission proposed a revision of the law in January 2024 to address the deficiencies identified. The COVID-19 pandemic, Russia’s war of aggression against Ukraine and other geopolitical tensions have underlined the need to be able to identify risks and do more to protect EU critical assets from certain investments.

Next steps
The new regulation now has to be formally approved by the Council too, before entering into force and being applied 18 months later.
 
 
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This blog post is part of a special series based on the April 2026 Commodity Markets Outlook, a flagship report published by the World Bank Group. This series features concise summaries of commodity-specific sections extracted from the report.
The World Bank Group’s fertilizer price index rose more than 12 percent in 2026Q1 (q/q), marking its sixth increase in seven quarters. By April 2026, the index had reached its highest level since October 2022, driven mainly by export disruptions related to the closure of the Strait of Hormuz. Urea prices recorded the largest gains, while increases in other fertilizers were more moderate. Despite the recent surge, price increases remain well below the spikes seen in 2021 and 2022, when fertilizer prices jumped by more than 100 percent and 55 percent, respectively, amid supply disruptions in Russia and Belarus—two of the world’s key fertilizer suppliers. The more subdued response this time reflects three factors: (i) growers in the Northern Hemisphere had already secured much of their fertilizer supply; (ii) natural gas prices (the main production cost for nitrogen-based fertilizers) rose less sharply than after Russia’s invasion of Ukraine; and (iii) trade flows from the Middle East are increasingly being rerouted through land corridors, bypassing the Strait of Hormuz. The fertilizer price index is projected to rise by more than 30 percent in 2026, supported by higher input costs—particularly for nitrogen- and phosphate-based fertilizers—and resilient global demand. Prices are expected to ease in 2027 as exports recover and new supply comes online. However, risks remain tilted to the upside if elevated energy prices persist and shipping and production disruptions linked to the Strait of Hormuz continue beyond 2026Q3.

Nitrogen (urea) prices climbed above $850 per metric ton in April, up 80 percent since February and the highest level since April 2022. The surge was driven by major export disruptions following the closure of the Strait of Hormuz, a key shipping route for fertilizer exports from the Middle East, which accounts for nearly one-quarter of global urea exports. Supply pressures have intensified due to production outages across the region. The Islamic Republic of Iran halted ammonia production amid the conflict, while Qatar suspended production of urea, ammonia, and sulfur after damage to key facilities. India has also reduced urea and ammonia output because of lower LNG supplies. Tighter supply and potential export curbs from China have added to market concerns, pushing fertilizer affordability for farmers to its weakest level since mid-2022.

Urea prices are projected to rise nearly 60 percent in 2026 before easing in 2027 as Middle East exports recover and natural gas prices moderate. However, risks remain tilted upward, including prolonged shipping disruptions from the Middle East, further trade restrictions, and higher input costs—especially natural gas prices—all of which could push urea prices above their 2022 average.

DAP (diammonium phosphate) prices rose more than 10 percent in April after remaining relatively stable earlier in the year. The increase reflects tightening supply conditions and rising input costs, particularly sulfur prices, which have doubled since January. China’s move to tighten exports has also added upward pressure on prices. As a result, the DAP-to-food price ratio—which had declined for six straight months through February—rebounded in March and April.

DAP prices are projected to rise nearly 6 percent in 2026 before falling about 10 percent in 2027 as new production capacity comes online. However, major risks remain. Renewed export restrictions by China or a prolonged closure of the Strait of Hormuz could significantly disrupt global fertilizer trade, especially since the route handles a large share of global sulfur and ammonia shipments—both critical inputs for DAP production. Supply concerns have also intensified after Morocco’s OCP accelerated maintenance at its phosphate facilities, likely in response to disruptions in sulfur and ammonia markets.

MOP (muriate of potash) prices rose more than 5 percent in 2026Q1 and were nearly 17 percent higher than a year earlier. Despite the increase, affordability relative to food prices has remained close to pre-2020 levels. The market is becoming increasingly well supplied, supported by higher exports from Belarus following the easing of U.S. sanctions, as well as stronger shipments from Russia, Canada, and  the Lao People’s Democratic Republic. Supply conditions are expected to remain comfortable through 2026 and 2027.

MOP prices are forecast to rise about 12 percent in 2026 before easing 6 percent in 2027. The broader outlook remains balanced, as potash markets are less exposed to Middle East disruptions than other fertilizers. Still, sharper-than-expected increases in urea or phosphate prices could prompt farmers to cut MOP use to manage costs, weakening demand and exerting downward pressure on prices. In the longer term, major new production capacity—especially in Canada, the world’s largest potash producer and exporter—could add further downward pressure.

Compliments of the World Bank
The post World Bank | Fertilizer Prices Surge as Strait of Hormuz Disruptions Tighten Supplies first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.

The Commission published its fifth State of the Schengen report, reviewing developments in the Schengen area over the past year and setting priorities for the year ahead. The Schengen area continues to demonstrate resilience, underpinned by collective efforts at both EU and national level.
The Schengen area is one of the European Union’s most tangible and valued achievements, enabling a more than 450 million EU citizens to travel, work, study and live freely across borders while supporting trade, tourism and freedom of movement of goods vital to the European economy, alongside strong cooperation to protect the Union’s external borders.
The 2026 State of Schengen Report highlights significant achievements during the past year. These include a better protected external border and a decrease of 26% in illegal border crossings in 2025 compared to 2024. Joint efforts also resulted in more effective returns of persons without a right to stay in the EU, with a 28% return rate in 2025 – the highest return rate in the past 10 years. A key milestone for external border protection was the full launch of the Entry/Exit System (EES) in April 2026, delivering on a stronger, more digitalised Schengen area. Already in the first 6 months of operation, Member States registered over 66 million entries and exits and 32 000 persons, who had no right to enter the EU, were refused. The Commission also adopted the EU’s first-ever Visa Strategy in January 2026.
At the same time, the report showed that challenges remain requiring actions at EU level and by Schengen States. This is particularly important in the context of today’s geopolitical environment which calls for reinforced collective responsibility to ensure that the Schengen area remains secure, united and resilient.
The priorities for the fifth Schengen cycle (2026-2027) will focus on consolidating achievements, addressing remaining gaps, and enhancing preparedness to meet current and future challenges. Work will continue in the following areas:

Supporting Schengen’s external dimension: including with the upcoming proposal for a revised Visa Code which will address security elements of the EU visa policy. In addition, developing partnerships with key countries to attract talent for innovation and enhance the EU’s global competitiveness will also be prioritised.
An integrated external border for a secure Schengen area: advancing the digitalisation of procedures, with the continued implementation of the new Entry-Exit System and the launch of ETIAS, the new travel authorisation for visa-exempt travellers. This will be further supported by the effective implementation of the Screening Regulation and reinforced contingency planning under the Pact on Migration and Asylum.
An effective return system: Schengen states should further strengthen operational capabilities and tools to support returns, while making use of Frontex support. An effective implementation of the new return border procedure – a key feature of the Pact on Migration and Asylum – will further strengthen the EU’s return system.  The Commission will also present a legislative proposal on return digitalisation in 2026, with a view to developing digital case management systems in this area. This will further contribute to reducing the administrative workload of national authorities, simplifying and automating processes.
Consolidating the operational framework for internal security cooperation:  through continued structured dialogue facilitated by the Schengen Coordinator with all Member States concerned or affected by internal border controls, in view of the gradual lifting of controls.
Strengthening the Schengen governance with strategic funding under the next long-term budget (MFF) and more systematic country-specific discussions. At EU-level work should continue to complete Cyprus’ Schengen accession, to reach full implementation of the Schengen rules relevant to internal security in Ireland and to continue strong engagement with enlargement countries.

Next steps
The Commission invites the Schengen Council to discuss the 2026 State of Schengen report and adopt the 2026-2027 priorities at the Justice and Home Affairs Council in June.
Background
The Commission has been evaluating annually the State of Schengen since 2022 as part of a reinforced Schengen governance framework. This exercise marks continued delivery on the Commission’s initiative to reinforce the common governance of the Schengen area and ensure a structured, coordinated and common response to its challenges
 
 
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Blog | Non-bank financial institutions (NBFIs) are on the rise. This blog shows how shifts in their borrowing and investment portfolios constrain financing for euro area firms and affect the transmission of monetary policy.
Two trends have diverted financing away from euro area firms in recent years. First, euro area NBFIs have shifted their portfolios towards foreign assets – particularly US equities. Second, banks have channelled more lending to NBFIs outside the euro area. Together, these cross-border flows via NBFIs contributed to a sluggish recovery in firms’ external financing over recent years.
NBFIs are reshuffling their portfolios at the expense of euro area firms
NBFIs, such as investment funds and insurers, play a crucial role in financing firms through both equity and bond markets. In recent years, euro area NBFI securities holdings have grown substantially, rising from around €11 trillion in early 2018 to €17 trillion by the end of 2025 (Chart 1, panel a). Investment funds account for roughly 60% of the total.[1] Strikingly, however, the composition of these portfolios has been shifting away from European assets more recently.[2]
Most of this reflects the exceptional performance of US stocks – especially in the tech sector. This has systematically raised their value relative to European holdings. But the changing composition of NBFIs’ portfolios is not just a valuation story: NBFIs, particularly investment funds, do not just hold US equities, they have also been buying them.
Since late 2023 euro area NBFIs have increased their allocation to US corporate equities by around 2.7 percentage points through net purchases. At the same time, they have reduced their allocation to euro area corporate equities by about 1.5 percentage points (Chart 1, panel b, left). The reallocation has come, to a lesser extent, at the expense of euro area government bonds and bank equities.

Chart 1
Developments in NBFI equity and debt portfolios

a) NBFI debt and equity holdings, by issuer sector and geography

b) NBFI holding of firm equity

EUR trillion

percentage points

Source: ECB (SHSS), ECB calculations and Henricot, D., Mendicino, C., Molestina Vivar, L. and Pelizzon, L. (2026).
Notes: For panel a) amounts are in market value. The holdings are for euro area NBFIs (ICPF, IF, MMF and OFIs). For panel b), left-hand scale, the chart shows NBFIs’ cumulative transaction-based firm equity portfolio share changes for NFCs in the euro area, the United States and other countries in relation to the fourth quarter of 2023. NBFIs include ICPFs, IFs, MMFs, and OFIs. The right-hand scale is based on a coefficient from a regression of euro area NFC equity shares on US NFC equity shares in euro area NBFI portfolios, based on sector-level data and controlling for NBFI sector and quarter fixed effects (2014-25).
The latest observations are for the fourth quarter of 2025.

These developments clearly matter for the financing of euro area firms. Research by Henricot, Mendicino, Molestina Vivar and Pelizzon finds that increases in the share of US corporate equities in NBFI portfolios are associated with declines in the share of euro area equities. An increase of 1 percentage point in the share of US equities in NBFI portfolios is associated with a 0.3 percentage point reduction in the share of euro area corporate equities (Chart 2, panel b, right).[3] While the substitution effect is not one-for-one, it is meaningful and material. And it suggests that the growing appetite for US assets may be squeezing out equity financing for European businesses.
Banks are lending more to non-bank financial institutions and less to firms
A similar dynamic is playing out on the banking side. Bank exposures to NBFIs have grown steadily in recent years, reaching around 11% of total assets by the end of 2025 (Chart 1, panel a).[4] Most of this takes the form of direct loans predominantly to investment funds and other financial institutions – mainly short-term collateralised loans (reverse repos). A substantial share of these loans is directed to entities operating outside the euro area.[5]

Chart 2
Bank loans to non-banks and firms

a) Bank asset-side exposure to NBFIs

b) Bank loans to non-banks and firms

percentages of total assets

LHS: percentage points; RHS: coefficient

Source: For panel a) ECB (Supervisory Reporting) and ECB calculation; for panel b) ECB (Supervisory Reporting, AnaCredit), Orbis, ECB calculations and Li, Ma, Mendicino, Supera (2025).
Notes: Panel b), left-hand scale, shows cumulated change relative to the fourth quarter of 2023. NBFIs stands for non-bank financial institutions. Bank loans exclude loans held for trading. The sample consists of a balanced sample of significant institutions reporting under IFRS. The right-hand scale is based on a coefficient from a regression of firm borrowing, on the dynamics of bank lending to NBFIs by each firm’s relationship banks, between 2019-25.
The latest observations are for Q4 2025.

It is especially notable that this trend has come at the expense of lending to firms (Chart 1, panel b).[6] Research by Li, Ma, Mendicino and Supera shows that when the bank a firm borrows from increases its NBFI lending by 1 percentage point, that firm’s access to bank credit falls by 0.55 percentage points on average (Chart 1, panel b). Crucially, firms cannot easily make up the shortfall by turning to other banks or NBFIs for alternative funding.[7]
In the current geopolitically uncertain environment[8], reverse repos to NBFIs are an attractive option for banks, particularly those with weaker capital positions. It is therefore unsurprising that this expansion aligns with the risk-averse attitudes banks have reported in recent surveys.[9]
Conclusion
The two trends described in this post point in the same direction: cross-border flows via NBFIs weigh on the recovery of firm financing over the ECB’s easing cycle.
When euro area investment funds reshuffle their portfolios in favour of US equities, European firms find it harder to raise capital in markets. When banks shift towards foreign NBFIs over domestic borrowing firms, European firms find it harder to secure loans. The result is a sluggish financing recovery that is lagging behind policy rates.[10] This is a reminder that as NBFIs grow in global importance their cross-border behaviour deserves close and sustained attention from policymakers.
The views expressed in each blog entry are those of the author(s) and do not necessarily represent the views of the European Central Bank and the Eurosystem.
 
 
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The Council presidency and European Parliament negotiators reached a provisional agreement on a proposal to streamline certain rules regarding artificial intelligence (AI).
The proposal forms part of the so-called ‘Omnibus VII’ legislative package in the EU’s simplification agenda. The package includes proposals for two regulations aiming to simplify the EU’s digital legislative framework and the implementation of harmonised rules on AI.
“Today’s agreement on the AI act significantly supports our companies by reducing recurring administrative costs. It ensures legal certainty and a smoother and more harmonised implementation of the rules across the Union, strengthening EU’s digital sovereignty and overall competitiveness. At the same time, we are stepping up the protection of children targeting risks linked to the AI systems. This agreement is clear evidence of our institutions’ ability to act swiftly and deliver on our commitments. It marks the first deliverable under the ‘One Europe, One Market’ roadmap agreed by the three institutions, well within the set deadline.” – Marilena Raouna, Deputy Minister for European affairs of the Republic of Cyprus
The Commission had proposed to adjust the timeline for applying rules on high-risk AI systems by up to 16 months, so that the rules start to apply once the Commission confirms the needed standards and tools are available. The Commission had also proposed further targeted amendments to the AI act that would extend certain regulatory exemptions granted to SMEs also to small mid-caps (SMCs), reduce requirements in a very limited number of cases, extend the possibility to process sensitive personal data for bias detection and mitigation, reinforce the AI Office’s powers and reduce governance fragmentation. Given that provisions on high-risk AI systems are due to enter into force on 2 August 2026, the co-legislators have treated the proposal with utmost priority, and, in that perspective, broadly maintained the thrust of the Commission’s proposal.
Main amendments introduced by the co-legislators
The co-legislators added a new provision in the AI act, prohibiting AI practices regarding the generation of non-consensual sexual and intimate content or child sexual abuse material (CSAM). The provisional agreement also introduces a fixed timeline for the delayed application of high-risk rules: the new application dates would be 2 December 2027 for stand-alone high-risk AI systems and 2 August 2028 for high-risk AI systems embedded in products.
Furthermore, the provisional agreement reinstates the obligation for providers to register AI systems in the EU database for high-risk systems, where they consider their systems to be exempted from classification as high-risk. It also reinstates the standard of strict necessity for the processing of special categories of personal data for the purpose of ensuring bias detection and correction.
The provisional agreement postpones the deadline for the establishment of AI regulatory sandboxes by competent authorities at national level until 2 August 2027 and reduces the grace period for providers to implement transparency solutions for artificially generated content from 6 months to 3 months, with the new deadline set on 2 December 2026. The deal between the co-legislators also clarifies the competences of the AI Office for the supervision of AI systems based on general-purpose AI models where the model and that system are developed by the same provider by listing exceptions where national authorities remain competent, including law enforcement, border management, judicial authorities and financial institutions.
As for the AI act’s rules for industrial AI and their interplay with sectoral legislation in sectors such as medical devices, toys, lifts, machinery and watercraft, a compromise was found between the co-legislators on a mechanism that allows to resolve situations in which sectoral law has similar AI-specific requirements to the AI act, by limiting the latter’s application in those specific cases through implementing acts. In addition to this, a compromise was found to exempt the machinery regulation from direct applicability of the AI act. The Commission was also empowered to adopt delegated acts under the machinery regulation which would add health and safety requirements in respect of AI systems that are classified as high-risk pursuant to the AI act. This solution effectively addresses any possible overlaps between the high-risk requirements from the AI act and those from sectoral legislation. The provisional agreement also adds a new obligation for the Commission to provide guidance to assist economic operators of high-risk AI systems covered by sectoral harmonisation legislation in complying with the high-risk requirements of the AI act in a manner that minimises compliance burden.
Next steps
Today’s provisional agreement must be now endorsed by the Council and the European Parliament before being submitted to a legal/linguistic revision with a view to the formal adoption of the legislative act by the co-legislators in the coming weeks.
Background
In October 2024, the European Council called on all EU institutions, member states and stakeholders, as a matter of priority, to take work forward, notably in response to the challenges identified in the reports by Enrico Letta (‘Much more than a market’) and Mario Draghi (‘The future of European competitiveness’). The Budapest declaration of 8 November 2024 subsequently called for ‘launching a simplification revolution’, by ensuring a clear, simple and smart regulatory framework for businesses and drastically reducing administrative, regulatory and reporting burdens, in particular for SMEs.
Since February 2025, as a follow-up to the call by EU Leaders at that and subsequent meetings, the Commission has put forward ten ‘Omnibus’ packages aiming to simplify existing legislation on sustainability, investment, agriculture, small mid-caps, digitalisation and common specifications, defence readiness, chemical products, digital issues including on AI, environment, the automotive sector and food and feed safety.
 
 
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With the EU Biotech Act marking a major push to strengthen Europe’s biotechnology sector, new OECD research offers a timely check on where the bloc stands. The evidence shows that Europe still lags competitors in biotech start-up creation, patenting and venture capital funding. This blog unpacks the gap and explores how agile regulation and smarter financing tools can help EU policymakers build a more competitive biotechnology start-up ecosystem.
Biotechnology has the potential to drive economic growth and high-value job creation, deliver life-saving treatments, and offer sustainable alternatives in manufacturing. The European Commission’s publication of the EU Biotech Act Part I (with a Part II focused on non-health biotechnologies and the broader bioeconomy expected in late 2026) reflects the scale of that ambition.
New OECD research suggests that the bloc has significant ground to make up: across indicators including start-up creation, patenting activity, and venture capital investment, the EU trails other major research economies.
Why Europe’s biotech research prowess isn’t producing start-ups
The European Union is a recognised world leader in foundational biotechnology research. In 2022, it held 21% of the global share of the top 10 most cited publications in biology, biomedical research and clinical medicine, close to the United States’ 22% and China’s 24%. Yet this strength is not translating into commercial activity. Data from the OECD Start-ups Database shows the EU has consistently produced around half as many biotechnology start-ups as the US over the past two decades. Whilst this gap has narrowed in recent years, this appears to be driven by a contraction in the US rather than growth in Europe.
This points to weaknesses in the EU biotechnology innovation ecosystem, ones that become clearer when examining two key enablers of start-up creation: intellectual property and funding.
Shortcomings in European patenting and VC funding
Patenting reflects an ecosystem’s ability to turn R&D into commercially viable intellectual property and is critical for start-ups seeking to protect innovations and secure financing. Yet, between 2000 and 2022, EU biotechnology start-ups fell steadily behind their US counterparts in patent filing. The gap peaked in 2022 with US start-ups filing almost four times as many patents. While this partly reflects the larger number of US start-ups, it still points to a comparative weakness in European biotechnology innovation.

Venture capital is particularly important to biotech start-ups, which face long development cycles, high upfront R&D costs and complex regulatory processes, making early-stage funding critical for survival and growth. Here too, the EU lags significantly. OECD analysis shows the US has consistently outpaced the EU in biotech venture capital investment over the past decade, peaking in 2021 when US funding was up to 10 times greater.

How EU biotechnology regulation impacts innovation and investment
These gaps reflect many interconnected factors, from entrepreneurship culture to international competition. But regulation deserves particular attention, given its direct influence on investment patterns and start-up development.
OECD research has found that EU biotechnology regulation is both complex and fragmented, with overlapping rules at both the European and Member State level creating uncertainty for innovators. In some cases, existing legislation even works actively against biotechnology adoption. The Fertilizing Products Regulation, for example, only permits microbial strains in fertilizer products if they are not genetically modified, effectively blocking novel biotech alternatives to traditional chemical fertilisers.
Beyond complexity, the EU regulatory approval process is notably slow. Strict data requirements and limited scope for derogation and pre-submission consultations between innovators and regulators all contribute to lengthy and costly timelines. In contrast, jurisdictions like the US and Singapore routinely offer pre-submission consultations, helping innovators clarify expectations and avoid delays. The difference in outcomes is notable. Industry studies suggest that approving genetically modified crops for food and feed, for example, can take up to 6 years in the EU, compared to 1.8 years in the United States, 1 year in Australia, and 5 months in Canada.
What can EU policymakers do to boost biotech start-up competitiveness?
OECD research points to agile regulation as a way to make approval processes more adaptable. In practice, this means tools like regulatory sandboxes and innovation testbeds that allow for controlled real-world experimentation, and early structured engagement between regulators and innovators to streamline complex approval pathways.
Strategic foresight approaches and participatory technology assessments can also help by identifying where these tools are most needed across the policy cycle (see diagram below).
The United Kingdom’s Engineering Biology Sandbox Fund offers a concrete example. In 2024, it provided £1.6 million to the Food Standards Agency Cell-Cultivated Product (CCP) Sandbox Programme, which allowed regulators to build familiarity with novel technologies while helping participating companies reduce approval timelines and attract scale-up investment.

Smarter financing can also help close the gap. De-risking tools – such as risk transfer mechanisms, blended finance structures, and public co-investment and guarantees – can support biotech start-ups at the costly stages of demonstration and scale-up, where private capital is the hardest to attract. Demand-side measures can work alongside these efforts. The United States Department of Agriculture’s BioPreferred Program, for example, requires federal buyers to prefer bio-based products across 139 categories (e.g. paints, lubricants), backed by a database of almost 10 000 products. This kind of demand gives investors confidence that markets exist for biotechnology innovations, a signal that European policymakers could replicate.
Can the EU Biotech be a game changer for biotechnology start-ups?
The EU Biotech Act Part I appears to address several of the barriers and solutions outlined above. For example, it introduces regulatory sandboxes to allow controlled experimentation with novel technologies, expands pre-submission consultations to help innovators navigate regulatory submission processes, creates a strategic project designation to fast-track funding and regulatory clearance, and establishes a €10 billion Health Biotechnology Investment Pilot with the European Investment Bank to mobilise private capital through risk-sharing instruments.
These are substantive measures. But their long-term impact will depend on whether regulation becomes more agile in practice, and whether financing instruments reach biotech start-ups at the costly stages of demonstration and scale-up. Closing the gap in biotechnology start-up creation, venture capital investment and patenting will require measures designed with start-ups explicitly in mind: faster, simpler and more accessible pathways that turn Europe’s research excellence into commercial activity.

Click here to access the interactive charts.
 
 
 

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Today, the EU and US signed a Memorandum of Understanding (MoU) on a strategic partnership on critical minerals and agreed an EU-US Critical Minerals Action Plan. These initiatives reflect the EU’s commitment to deepen cooperation on critical raw materials. This is a key step in enhancing resilience and diversification of supply chains, amid shared geopolitical and economic challenges.
Signed today by Commissioner for Trade and Economic Security Maros Šefčovič and US Secretary of State Marco Rubio in Washington DC, the MoU formalises the EU-US strategic partnership to build secure, sustainable critical minerals supply chains. It foresees bilateral cooperation across the full value chain – spanning exploration, extraction, processing, refining, recycling and recovery, while supporting innovation, investment and geological mapping as well as supply- and demand-side measures.
Additionally, Commissioner Šefčovič and US Trade Representative Jamieson Greer set out an Action Plan for Critical Minerals Supply Chain Resilience, which paves the way towards a possible plurilateral trade initiative with global partners.
Under the Action Plan, the EU and the US intend to work together to explore a broad range of trade policies and instruments to reinforce coordinated international action. These may include border-adjusted price floors, standards-based markets, price gap subsidies and offtake agreements. In addition, cooperation is expected to focus on the development of common standards for mining, processing and recycling; the promotion of investment; joint research and innovation; stockpiling strategies; and mechanisms for rapid response to supply disruptions.
Both sides plan to continue working on critical minerals resilience in relevant international fora, including the G7 and the Forum on Resource Geostrategic Engagement (FORGE).
Both, the MoU and the Action Plan follow up on shared commitments decided on at the Critical Minerals Ministerial meeting held in Washington DC on 4 February 2026, alongside Japan. Closer cooperation in the area of critical minerals is foreseen in the Joint Statement of 21 August 2025 between the EU and the US.
 
“Secure and sustainable access to critical minerals is vital for the competitiveness and resilience of the EU economy. The MoU with the United States is the EU’s 16th bilateral instrument on critical raw materials. Together, these MoUs make a significant part of our strategy to reduce dependencies, foster innovation, and ensure that our supply chains are resilient against global disruptions. By working together with partners across the globe, we can shape fair and transparent markets that benefit our economies and industries. ” – Stéphane Séjourné, Executive Vice-President for Prosperity and Industrial Strategy
“It is encouraging to see EU-US cooperation on critical raw materials taking concrete shape. The vision is there – now the real test is execution, by turning shared ambitions into impactful projects. This will define our success. Critical minerals sit at the core of every future-facing industry – resilience is therefore inevitable and addressing vulnerabilities an imperative.” – Maroš Šefčovič, Commissioner for Trade and Economic Security; Interinstitutional Relations and Transparency
 
 
 
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Resilience, supervision, and international coordination are essential to safeguarding global financial markets as new AI tools enable attackers.
Artificial intelligence is transforming how the financial system copes with vulnerabilities and reacts to incidents. Yet it is also amplifying cyber threats that can undermine financial stability when the offensive capabilities of intruders outpace defenses.
IMF analysis suggests that extreme cyber‑incident losses could trigger funding strains, raise solvency concerns, and disrupt broader markets.
The financial system relies on shared digital infrastructure that’s highly interconnected, including software, cloud services, and networks for payments and other data. Advanced AI models can dramatically reduce the time and cost needed to identify and exploit vulnerabilities, raising the likelihood of simultaneously discovering and targeting weaknesses in widely used systems. As a result, cyber risk is increasingly about correlated failures that could disrupt financial intermediation, payments, and confidence at the systemic level.
Anthropic’s recent controlled release of its Claude Mythos Preview, an advanced AI model with exceptional cyber capabilities, underscored how quickly risks are increasing. Mythos could find and exploit vulnerabilities in every major operating system and web browser—even when used by non-experts. This foreshadows how fast‑moving, AI‑driven cyber risks could destabilize the financial system if not managed carefully, and why authorities must focus on building resilience through supervision and coordination—rather than treating these developments as purely technical or operational issues.
On the other hand, OpenAI’s specialized, restricted cyber version of GPT‑5.5 assumes vulnerabilities and attacks will grow, and emphasizes equipping defenders more quickly and at scale, under appropriate governance and trusted access models.
Advances change risk equation
Models such as Mythos illustrate the nature of the challenge because they amplify existing cyberattack techniques by operating at machine speed. Attackers have the advantage over defenders because discovering and exploiting vulnerabilities can occur faster than patching and remediation. In a financial system built on common software and shared service providers, this can create simultaneous vulnerabilities across many institutions.
For now, some mitigating factors remain. Advanced AI cyber capabilities are not yet widely available, and closed, industry‑specific financial software is harder to target than open‑source infrastructure. But these buffers are likely to erode quickly as model training expands, capabilities diffuse, and leaks occur. Temporary containment is unlikely to substitute for durable defenses.
Financial stability implications
The new AI‑enabled cyber tools focus the discussion on financial stability:

Risks are systemic. Attacks become more dangerous when discovery and exploitation scale rapidly, with implications for financial stability.
Risks cut across sectors. The financial sector shares digital foundations with energy, telecommunications, and public services. That means AI‑assisted attacks can propagate across sectors that rely on the same infrastructure.
AI may further concentrate risk and failures with one vulnerability rippling across many institutions. Reliance on a small number of software platforms, cloud providers, or AI models increases the impact of any single exploited weakness.

These features elevate cyber risk to a potential macro‑financial shock. Confidence effects, payment disruptions, liquidity strains, and fire‑sale dynamics could follow if multiple institutions are affected simultaneously. For financial authorities, the question is whether the system is prepared to absorb cyber incidents without destabilizing core financial functions.
AI in cyber defense
AI is also a critical part of the solution. When attackers operate at machine speed, defenders must do the same. Financial institutions increasingly use AI‑supported tools to detect threats, prevent fraud, identify vulnerabilities, and respond to incidents.
AI also can help reduce vulnerabilities at the development stage rather than patching them after release. For widely used financial infrastructure, these gains can meaningfully reduce systemic exposure. But these benefits will materialize only if institutions invest in integration, governance, and human oversight—areas that supervisors increasingly need to assess. This also includes business continuity and disaster recovery, cyber and quality assurance programs, and good cyber hygiene practices.
Resilience-first policy framework
AI-driven cyber risk demands a policy response that treats cybersecurity as a core financial stability issue. Existing measures remain relevant, but they must be expanded and sharpened for a world of faster, automated, and increasingly sophisticated attacks. Policymakers should prioritize robust resilience standards, supervision focused on systemic transmission channels, and close public-private collaboration on threat intelligence and incident response.
Defenses will inevitably be breached, so resilience must also be a priority, specifically to limit how far incidents spread and ensure rapid recovery. Controls to stop the spread of attacks can prevent local breaches from escalating into system‑wide disruptions. These measures are often costly and complex, but they are among the most effective tools for containing AI‑enabled attacks.
From a supervisory perspective, this underscores the need to focus not only on prevention, but on response, recovery, and continuity of critical functions. Cyber stress testing, scenario analysis, and board‑level oversight of cyber risk are becoming indispensable components of financial stability frameworks.
International cooperation is vital
The Mythos episode also highlights governance challenges. Cyber risk does not respect borders. As AI capabilities spread across countries, inconsistent oversight could weaken a globally interconnected system.
Emerging and developing economies, which often have more severe resource constraints, may be disproportionately exposed to attackers targeting regions with weaker defenses. That’s why stronger international coordination, more information sharing, and expanded capacity development are critical to preserving global financial stability.
As AI reshapes the cyber landscape, the central question for authorities is whether the financial system can continue to function under severe stress. Answering that question requires putting systemic risk—and the tools to manage it—at the center of the AI‑cyber conversation.
 
 
Compliments of the International Monetary FundThe post IMF | Financial Stability Risks Mount as Artificial Intelligence Fuels Cyberattacks first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.

The Council today provisionally agreed new rules to strengthen the fight against value added tax (VAT) fraud in the EU by ramping up cooperation between member states, the European public prosecutor’s office (EPPO) and the European anti-fraud office (OLAF).
The new framework will give EPPO and OLAF more direct access to key VAT data on cross-border business transactions in the EU, including information held by Eurofisc – the EU’s anti-VAT fraud network.
” We have taken massive strides in tackling VAT fraud over recent years. But our budgets still lose out to the tune of billions of euros every year and authorities need the right tools to tackle these criminal activities more quickly. Today’s agreement will give EU investigative bodies the targeted information they need to pursue criminals swiftly and to protect national and EU revenues that benefit us all.”- Makis Keravnos, Minister of Finance of the Republic of Cyprus
Cross-border VAT fraud, in particular missing trader intra-community fraud (commonly known as carousel fraud), is a serious problem in the EU. According to the European Commission, this criminal activity costs member state treasuries and the EU budget between €12.5 billion and €32.8 billion annually and is carried out mostly by organised crime groups.
In practice, the new framework means that EPPO and OLAF will have the first-hand information they need to launch and support investigations under their competences into suspected cross-border VAT fraud. This will improve coordination between the various actors, speed up investigations, and strengthen the EU’s overall capacity to detect and combat VAT fraud affecting the Union’s financial interests. At the same time, it will help put the EU’s legitimate businesses on a more level playing-field.
Background
The new rules take the form of a regulation amending Council regulation 904/2010 on administrative cooperation and combating VAT fraud. The measure follows the agreement in March last year to make VAT reporting obligations for companies who sell goods and services to businesses in another EU member state fully digital by 2030 which should further support the fight against VAT fraud.
Next steps
Once the European Parliament has adopted its opinion on the file – currently expected in July 2026 – the Council will proceed to formally adopt the new rules. The regulation will enter into force twenty days after its publication in the official journal of the EU.
 
 
Compliments of the European Council The post European Council | VAT fraud: Council agrees to strengthen cooperation with EU investigative bodies first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.

The energy price index rose 12.1% in April, driven largely by crude oil (+8.7%). The non-energy price index increased 3.2%.
Agricultural prices gained 1.5% in April, led by food prices (+1.5%); raw materials rose 2.5%, while beverage prices edged up 0.4%. Fertilizer prices surged 14%
Metals edged up 1.4% in April, led by aluminum (+6.7%), zinc (+5.7%), and nickel (+5.2%). Precious metals fell 2.7%, weighed down by a decline in gold (-2.8%).
The Pink Sheet is the World Bank’s monthly report on commodity price movements.

The energy price index rose 12.1% in April, driven largely by crude oil (+8.7%). The non-energy price index increased 3.2%.
Agricultural prices gained 1.5% in April, led by food prices (+1.5%); raw materials rose 2.5%, while beverage prices edged up 0.4%. Fertilizer prices surged 14%
Metals edged up 1.4% in April, led by aluminum (+6.7%), zinc (+5.7%), and nickel (+5.2%). Precious metals fell 2.7%, weighed down by a decline in gold (-2.8%).
The Pink Sheet is the World Bank’s monthly report on commodity price movements.

Compliments of the World Bank 

The post World Bank | Commodity Prices Rose in April—Pink Sheet first appeared on European American Chamber of Commerce New York [EACCNY] | Your Partner for Transatlantic Business Resources.