New sanctions push, Poland-Germany reset

Polish saying of the week: “Pańskie oko konia tuczy.”
“The master’s eye fattens the horse.”

Meaning: When you’re directly involved in supervising the work, it’s bound to bring better effects. Substitute “master” for “commissioner” and “horse” for “ammunition factory.”

JUNE 5, 2025 Highlights EU industry gathers to figure out how to stay competitive. On June 5-6, the most influential political figures from the EU, Poland, and Ukraine gather to chart the future of European industrial policy at the EU Industry Days 2025. Among the key voices will be Stéphane Séjourné, European commission industrial strategy chief and Krzysztof Paszyk, Poland’s technology and economic development minister. Their goal is to explore how to boost the EU’s prosperity through deeper single market integration, more advanced manufacturing, reduced dependency on foreign critical raw materials, and capital market-driven investment. The chemicals sector will showcase EU leadership in sustainable management. Medtech will make its case as a leading driver of the next wave of innovation. Steel is sounding the alarm on competitiveness, arguing that only a robust, state-supported hydrogen market can help it reach net-zero emissions. Automotive will seek to reignite growth, while the wind energy industry aims to reassert itself as a cornerstone of EU competitiveness. A panel organised by the Polish-Ukrainian Chamber of Commerce will explore how security can serve as a catalyst for industrial cooperation between the two countries.

The bigger picture | Industrial policy, long a secondary concern for the Polish government, only gained serious attention from the prime minister in the last six months, starting with his unveiling of a major economic development plan in February that promises direct state intervention to support modern technologies and build adequate energy and transport infrastructure. Meanwhile, key energy-intensive sectors – such as chemical, steel, and automotive – have faced mounting challenges from foreign competitors. At the same time, EU industry is facing very similar difficulties and now the Polish government will try to use this common understanding to forge a more accommodating environment for these sectors.

Poland is set to work swiftly on new sanctions against Russia. The Polish presidency has successfully negotiated two packages of restrictions, and the European Commission is currently preparing the next tranche. However, the Commission is holding back from submitting the draft to the EU Council, hoping to coordinate next steps with the US. On June 2, Ursula von der Leyen discussed the issue with US Senator Lindsey Graham, who is pushing for the US to impose extremely tough sanctions if Moscow refuses to negotiate a peace agreement with Ukraine. According to leaked information, the new draft EU restrictions include sanctions on more than 20 Russian banks, the Nord Stream pipelines, and the Russian “shadow fleet”of vessels that Moscow is using to circumvent export bans, primarily on oil. The EU has already sanctioned over 300 boats, while an estimated 600 more are believed to be part of the fleet. A key element of the EU draft is to set the G7 Russian oil price cap well below the current $60 to reduce the revenues Russia uses to finance the war. However, an oil price cap would be impossible to implement without Trump's consent.

The bigger picture : President Trump says he is holding off on new sanctions in order to preserve the possibility of reaching a deal with Vladimir Putin to end the war in Ukraine.The problem is that Trump keeps pushing off his own ceasefire deadlines when Russia fails to meet them. The next test will be the G7 summit in Canada on June 15-17, where leaders are expected to agree on a Russian oil price cap of around $50. If they don’t, the EU will face the dilemma of whether to impose its new sanctions package without the oil component and without US cooperation. Plus, it may face issues with getting unanimous support from all 27 EU countries, particularly pro-Trump Hungary.

Maciej Szpunar brought EU lawyers to Katowice. Between May 28-31 the International Federation of European Law (FIDE) held its congress in Poland for the first time. On the lawyers’ agenda were the legal aspects of EU emergency response, energy solidarity and security, and the European digital market. The event was hosted by the Polish Association of European Law, which is headed by Maciej Szpunar, who is also the First Advocate General at the Court of Justice of the EU (ECJ). Szpunar has extensive background in digital regulation, both as a scholar and as an author of opinions that assist ECJ judges in their rulings. He also served as Undersecretary of State in both the Office of the Committee for European Integration and the Ministry of Foreign Affairs from 2008 to 2013. In this role, he coordinated the implementation of EU law in Poland, issued opinions on the compatibility of draft legislation with EU law, and represented the country in European courts. During Poland's first EU Council presidency in 2011, Szpunar was involved in negotiating the EU “fiscal compact”, which aimed to respond to the debt crisis by imposing stricter budgetary discipline on EU countries. Szpunar was appointed ECJ Advocate General in 2013 and has held the position of First Advocate General (out of eleven) since 2018.

The bigger picture: Amid current disputes over the EU's competitiveness and US criticism of EU regulatory barriers, EU critics and business leaders are resurfacing the idea that digital services can only thrive with weak state regulation. But the EU is standing its ground. In 2022, the bloc adopted two pieces of legislation (DSA and DMA) aimed at curbing the private power amassed by “digital gatekeepers”, such as major digital platforms. In Katowice, EU lawyers called for the DSA and DMA to be protected from both internal and external politics.

In Brief The US and EU discussed internal security in Warsaw. On June 2-3, US Attorney General Pamela Bondi and Rob Law, a senior advisor to the US homeland security secretary, attended the EU-US Ministerial Meeting on Justice and Home Affairs. The event was hosted by Poland’s Minister of Internal Affairs Tomasz Siemoniak and Minister of Justice Adam Bodnar. According to PI sources, despite tensions with the US administration on other matters, the meeting proceeded smoothly, and the Polish presidency was satisfied with the resulting official joint statement, which highlights a shared transatlantic perspective on a range of issues, from drug trafficking and counter-terrorism, to illegal migration. A reset in Polish-German relations? On June 4, foreign minister Radosław Sikorski visited Berlin to meet his German counterpart, Johann Wadephul. Their talks took place ahead of the two-day Polish-German Forum in Berlin, featuring diplomats and analysts from both countries. The event comes at an interesting time. It has been revived after a seven-year break, following a period of increased tensions in bilateral relations, and in the context of an ongoing dispute over border controls between the two countries. As the new German Chancellor, Friedrich Merz (CDU), has just begun his term and Karol Nawrocki (backed by PiS) has just won the election to become the new Polish president, the participants’ primary task will be to determine what the state of Polish-German relations actually is. Kubilius will tour Poland's ammunition plant. The Commissioner for Defence and Space will visit the Dezamet Nowa Dęba factory on Friday to promote two flagship projects on his agenda: the European Defence Industrial Strategy (EDIS) and the European Defence Industry Programme (EDIP). Kubilius will also use his speech to sum up the first stage of the implementation of ASAP (Act in Support of Ammunition Production), which was used for expanding production capacity in Dezamet. Earlier this week, a group of European Commission experts and officials toured Poland's defence sector facilities to learn first-hand about the industry's challenges and needs. NATO defence ministers discuss cash. The ministerial meeting on June 5 is expected to tentatively agree to raise the NATO defence expenditure target from 2 to 3.5% GDP, a decision that should be rubber-stamped at the NATO summit in The Hague on June 24-25. Under discussion will be an even larger target increase – of 1.5% GDP for each member – which would bring total defence spending up to 5% of GDP. The issue of the timeline for reaching these targets may be left until the summit, with 2032 being mentioned but some NATO allies pushing for 2035. The EU Council upheld the 8-year waiting time for generic drugs. The European Commission proposed reducing the period during which medicine producers can prevent competitors from accessing data used to develop new drugs from eight to six years. However, during negotiations on the new pharma package some EU countries demanded an extension to ten years. On June 4, the Polish presidency worked out a compromise position for the EU Council (to be negotiated with MEPs): eight years, extendable by a further two years on a case-by-case basis. Noted As Danes, we will always be tough in the negotiations on the [EU] budget. So we will be tough, but being a part of the Frugal Four is no longer the right place for us. Said Danish PM Mette Frederiksen supporting EU investment in armaments. The Frugal Four is an informal group of the Netherlands, Austria, Sweden, and Denmark in EU budget negotiations. In July, Denmark will take over the EU Council Presidency from Poland. With significant resources, we have brought the situation on the Polish-Belarusian border under control. Migrants transferred through Belarus as part of the hybrid war are not reaching Germany. Therefore, we consider controls at the Polish-German border unnecessary. Foreign minister Radosław Sikorski said at a press conference with his German counterpart, Johann Wadephul. The view from Poland What are president-elect Karol Nawrocki’s foreign policy views? President Andrzej Duda and Prime Minister Donald Tusk represented opposing political camps at home, yet they managed to find common ground on issues of security and international politics. Will this also be the case with the new president? On some points, Nawrocki’s views appear to differ from Duda’s. He is much more critical of Ukraine, although it is not yet clear what this will mean in practice. He is decidedly pro-Trump, positioning himself as a leading member of the MAGA right in Poland. He also distrusts Tusk’s close ties to Europe – while Poland’s right welcomes higher defence spending, it sees new EU defence programs as primarily supporting the Western European industrial base. With little experience in foreign affairs, it is possible that Nawrocki will be figuring out his definitive policy positions while in office. Read more about Nawrocki in PI’s analysis here. Bonus If you’d like to find out more about the aftermath of the presidential election and its possible influence on the Polish political scene, consider signing up for a free trial of our analytical service.
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What to watch next week June 5 TTE/Transport Council in Luxembourg.

June 5-6 EU Industry Days 2025 organised by the European Commission, in collaboration with the Ministry of Economic Development and Technology in Rzeszów.

June 6 TTE/Telecommunications Council in Luxembourg.

June 10 Coreper II meeting in Brussels.

June 11 Coreper II and Coreper I meetings in Brussels.

June 12 JHA/Justice Council in Luxembourg.

June 12-13 Forum of European University Alliances organised by the Ministry of Science in Wrocław.

Today's newsletter was curated by:
Authors: Tomasz Bielecki, Bartosz Krzemiński, Tomasz Sawczuk, Marek Świerczyński
Editor: Hanna Kozłowska
Graphic design: Karolina Tomaszewska
Front-end development: Maciej Kurczewski
Project management and supervision: Joanna Bekker, Maciej Michalik, Weronika Rędziniak and Marcin Bąba

Photos: Dominika Zarzycka / Zuma Press / Forum, Jussi Nukari/Lehtikuva Oy/East News, Freepik, Danish Parliament, www.gov.pl

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