The G20’s first-ever African summit opens in Johannesburg under a bruising sky: Washington—still 25 % of world GDP—has confirmed it will leave its chair empty after weeks of sparring with host South Africa over alleged discrimination against white farmers. Leaders from the EU, India and Brazil are pressing ahead, arguing that the forum—which collectively represents almost 80 % of global output—cannot be held hostage to bilateral grievances. (apnews.com)

The boycott reveals how economic nationalism now trumps multilateral pragmatism. With Europe flirting with recession and China’s growth below 4 %, debt-saddled developing nations need the $200 bn climate-finance package on the draft communiqué; without U.S. assent its enforcement mechanism risks dilution, echoing the fate of the 2009 Pittsburgh pledges that never materialised.

I read Washington’s absence less as isolationism than as a negotiating tactic—leveraging participation itself as currency. Yet history shows such brinkmanship backfires: when the U.S. skipped the 2016 AIIB launch, the bank still drew 57 members and now rivals the World Bank in green lending. As political economist Dani Rodrik warns, “Globalisation works only when major powers exercise, not abdicate, responsibility.”

— The Gist AI Editor

Trump’s Ukraine Peace Blueprint

The Trump administration has circulated a detailed 28-point framework aimed at ending the war in Ukraine, a proposal that will be difficult for Kyiv to accept as it requires significant territorial concessions to Moscow (Politico). This move signals a potential major pivot in U.S. foreign policy, prioritizing a swift, albeit controversial, resolution over long-term strategic support for Ukraine’s territorial integrity. The plan’s emphasis on a negotiated settlement, even at the cost of established borders, reflects a transactional approach to geopolitics that could reshape European security dynamics and test the transatlantic alliance.

Europe’s Economic Crossroads

European Central Bank (ECB) President Christine Lagarde issued a stark warning that Europe’s export-reliant growth model is becoming obsolete in a “disappearing” world of integrated global trade (FT). Lagarde accused policymakers of six years of inaction, a period during which geopolitical shifts and rising protectionism have undermined the continent’s economic foundations. This critique from the head of the EU’s central bank suggests that without deep structural reforms to foster domestic demand and innovation, Europe faces a future of stagnation, challenging the viability of its post-war economic consensus.

EU Policy & Defense Headwinds

Internal and external pressures are shaping EU policy. Talks for the UK to join the bloc’s €150 billion Security Action for Europe (SAFE) plan, a loans-for-weapons initiative, have stalled, missing a key deadline (Politico). This impasse highlights ongoing friction in post-Brexit security cooperation. Meanwhile, Commission President Ursula von der Leyen created a stir ahead of the COP30 climate summit by stating, “We are not fighting fossil fuels, we are fighting the emissions” (Politico). This distinction could weaken the EU’s push for a global phase-out of coal, oil, and gas, favoring carbon capture technologies over fundamental energy transition.

Housing’s Generational Toll

Unaffordable housing is creating profound second-order economic effects, with new research showing that younger generations are being forced to give up on homeownership (Marginal Revolution). A calibrated life-cycle model projecting outcomes for the U.S. cohort born in the 1990s indicates they will reach retirement with significantly lower savings. This isn’t just a market failure; it’s a looming crisis for social stability and future economic growth, as capital that would have been built through property ownership is instead diverted or never accumulated, straining future public resources.

Stay tuned for the next Gist—your edge in a shifting world.

Lagarde warns European growth is linked to ‘disappearing’ world
— Financial Times

PwC flagged WHSmith profit overstatement to accounting watchdog
— Financial Times

Five questions from an ignorant no-coiner about the crypto crash
— Financial Times

Read Trump’s latest Russia-Ukraine peace plan
— Politico.Eu

No deal on UK access to EU’s defense spending plan
— Politico.Eu

Von der Leyen says EU is not fighting fossil fuels, only emissions
— Politico.Eu

Brussels Challenges Rome’s Market Shield

The European Commission is formally challenging Italy’s “golden power” legislation, opening an infringement procedure against Rome. This state power allows the government to block or condition foreign takeovers in strategic sectors, including banking. Brussels argues these discretionary powers risk allowing for “unjustified interventions on economic grounds,” compromising the free movement of capital and freedom of establishment principles within the Single Market. My take: this is a necessary check on economic nationalism. While states have security interests, Italy’s rules can deter cross-border investment and undermine the Capital Markets Union (CMU)—the EU’s vital project for a genuine single market for capital. The move puts Italy’s government on the defensive, forcing it to respond within two months.

Peace Rumors Rattle Defense Stocks

European markets ended the week cautiously as geopolitical whispers from Ukraine directly impacted sector performance. The pan-European STOXX 600 aerospace and defense sub-index fell sharply after reports emerged of a U.S.-led peace plan to end the war. President Volodymyr Zelenskyy confirmed he had received the proposals from a U.S. delegation and would discuss them with President Trump. This news sent a chill through the defense sector, with major arms manufacturers like Rheinmetall seeing significant drops. The market’s logic is blunt: a potential de-escalation, however remote, tempers the long-term outlook for military orders. This illustrates the market’s extreme sensitivity to peace prospects as much as to conflict, a data point often lost in policy discussions.

Catch the next Gist for the continent’s moving pieces.

Fans kündigen Schweigeprotest an – DFL reagiert
— ZDF

Washington links the Jensen family to the CJNG leadership in charge of fuel theft
— El Pais

Why AI cannot create new scientific knowledge
— El Pais

Aktuelles zum Krieg in der Ukraine
— ZDF

Skispringen: DSV-Mixed-Quartett Vierte zum Auftakt
— ZDF

Infrazione Ue all’Italia per il golden power sulle banche. Giorgetti: ‘Supereremo le obiezioni’
— Ansa