These trends are particularly evident in Europe, where elections, treaties, and other events will reshape the continent. Before the end of 2018, the Italian government and the European Union were locked in a dispute over Italy’s budgetary plans. The European Commission sharply criticized the spending plans due to concerns that Italy’s approximately $3 trillion in debt combined with higher public spending could lead to a banking crisis that could spread to other countries in the Eurozone. While Rome did pass a revised budget to appease E.U. officials in Brussels, the ordeal has sewed divisions within Italy’s populist coalition government which are likely to persist throughout 2019. Tensions between Rome and Brussels will also continue, and possibly escalate.

The United Kingdom is scheduled to formally withdraw from the European Union on March 29, 2019. However, no agreement has been approved by the U.K. parliament that would avert a potentially catastrophic “no-deal” or “hard” Brexit. British Prime Minister Theresa May has come under considerable criticism from within her party over the tentative agreement her government negotiated with the E.U., but no alternative plans have been put forth. Regardless of the outcome, the U.K. will continue to strengthen bilateral relations with E.U. member states such as France, Germany, the Netherlands, and Poland.

In May, European Parliamentary elections will take place, while E.U. member states will appoint a new President of the European Commission in October. Despite a rise in nationalist and euro-skeptic parties, pro-European factions are expected to maintain overall control. A divided political landscape will make it difficult for the E.U. to implement any significant reforms. Furthermore, E.U. member states are divided when it comes to fiscal policy. Southern states like Italy, Portugal, and Spain are pushing for higher spending and greater risk-sharing, whereas northern states led by Germany are calling for greater fiscal responsibility in Frankfurt.

Ongoing Political Divisions in the E.U. and its Member States

E.U. member states after the U.K. withdrawal) to focus inwards. German Chancellor Angela Merkel has announced that her current term will be her last and resigned as leader of her Christian Democratic Union (CDU) Party. The CDU elected Annegret Kramp-Karrenbaur as party leader in the latter part of 2018. However, the party is divided over a range of policy positions. Furthermore, the CDU’s coalition partner is facing an identity crisis of its own, which has already weakened the coalition government. Further disagreements and intra-coalition infighting could lead to early elections in Germany.

In France, President Emmanuel Macron’s institutional and economic reforms have fueled substantial, and in some cases, violent opposition. Large-scale protests have erupted throughout France. 2019 will see continued opposition to Macron’s reforms, opposition stoked by groups on both the far-right and the far-left ends of the political spectrum. Some of Macron’s economic reforms will succeed, but French citizens will be increasingly vocal in their rejection of his attempts to revitalize the French economy.

Domestic political concerns will require greater attention from both Paris and Berlin, decreasing both powers from critical external affairs. Political divisions will hamper initiatives to achieve greater strategic autonomy through the implementation of increased European military integration and the promotion of the Euro over the U.S. Dollar as the global reserve currency. Therefore, it is unlikely these major initiatives will see substantial progress in 2019.

Trade and China

Trade will be a significant area of focus. If the U.S. imposes higher tariffs on European-manufactured vehicles, for instance, approximately 10% of total U.S.-E.U. trade will be affected. In such a scenario, the E.U. would be forced to respond in kind, leading to a greater rift in transatlantic relations. Automobile tariffs would disproportionately affect the German auto industry, which manufactures one in every three cars produced in Europe. However, trade disputes will not lead to the collapse of the transatlantic alliance, as both the U.S. and E.U. have concerns over unfair Chinese trade practices.

Aside from trade, Europe has other concerns with China. Led by the governments in Berlin and Paris, policymakers across Europe are increasingly wary over Beijing’s economic activity on the continent. As a result, Europe has begun to exclude China from investing in critical infrastructures such as ports and telecommunications networks. China filed suit against the E.U. in the WTO, arguing that Beijing should be treated as a market economy. The case will come to a resolution in 2019, and the outcome will have a significant impact on the ongoing trade dispute between the U.S., the E.U., and China.

The complicated bureaucratic system of rules and regulations, however, put poorer or smaller member states at an economic disadvantage. As such, these states are more welcoming to Chinese investment and lending. Those states that are receptive to Chinese economic activity in Europe will likely continue to lobby against Berlin And Paris. The European bloc’s position towards China will be ambiguous, leading to more vocal action by those states that are concerned about China’s economic activities.

Escalating Tensions Between Russia and the U.S.

The relationship between Russia and the United States will continue to deteriorate. The U.S. is set to formally withdraw from the Intermediate-Range Nuclear Forces (INF) Treaty, which bans intermediate-range missiles. Washington has cited Moscow’s noncompliance with the treaty as the justification for its withdrawal. The collapse of the INF treaty will heighten tensions in Eastern Europe, leading to a military buildup. This will be particularly visible in Poland and Romania, both of which will continue to lobby the U.S. for increased military commitments. Moscow will continue to build up its military forces in Kaliningrad, and the Crimea, both of which will likely play host to Russian intermediate-range missiles should the U.S. decide to deploy its own in Europe.

U.S. discussions with Poland regarding a possible permanent deployment of U.S. troops will continue throughout 2019. The Kremlin, citing what it perceives as “NATO-encirclement” will maintain, or even increase its efforts to interfere in the domestic politics of European states through malign activity in cyberspace, possible covert actions, and support for Euro-skeptic and nationalist factions across the E.U. The European parliamentary elections in May will provide Moscow with an opportunity to bolster the ranks of nationalist and Euro-skeptic groups, further sewing divisions within the E.U.

It is also possible that Moscow will open a military base in Belarus, as had previously been hinted by Belarusian President Alexander Lukashenko. However, Lukashenko has made increasing overtures to the E.U. and the U.S., which could lead to increased hostility from Moscow. Russia’s efforts to undermine the integrity of NATO and the E.U. will be particularly visible in the Balkan states of Serbia, Bosnia and Herzegovina, Montenegro, and Macedonia.

High Stakes for Ukraine as the Kremlin Deals With Domestic Challenges of its Own

Ukraine will face considerable challenges throughout 2019. Both the TurkStream and NordStream 2 natural gas pipelines are set to become active. The pipelines will circumvent Ukraine, providing Moscow with enormous economic leverage over Kiev. Ukraine will be deprived of substantial transit fees that it will now lose as the two pipelines exclude Ukraine from Russia’s natural gas supply lines.

Tensions between Russia and Ukraine have deteriorated in the aftermath of Russia’s seizure of three Ukrainian Navy vessels in the Sea of Azov, and tensions are expected to continue throughout 2019. The conflict in Eastern Ukraine will continue, and Ukraine is set to hold presidential elections in March. Depending on the outcome, negotiations could reopen between Moscow and Kiev, however, it is unlikely the two parties will come to a resolution. It is in Russia’s interest to maintain a state of low-grade or frozen conflict in Eastern Ukraine, which effectively prevents the former Soviet republic from joining NATO.

Russia, however, will face its own domestic challenges in 2019. The Kremlin has announced controversial economic reforms, including increasing the retirement age, raising the value-added tax (VAT), and imposing new taxes on certain consumer products and the tourism sector. The reforms are designed to bolster the government’s revenue but have generated considerable backlash from Russians across the country. It is the working class that will be hardest hit by the measures, which are due to come into effect this month. As such, there is likely to be a degree of social unrest. Meaningful changes are unlikely, however, as there is presently no viable opposition party capable of threatening Russian President Vladimir Putin’s hold on power.

Overall, 2019 will be a year of volatility in Europe. Diplomatic, trade, and economic disagreements will persist between Europe and the United States, and within Europe itself. Tensions between Russia and NATO heighten anxiety for Eastern European states, which will lead to a buildup of military capabilities on both sides.

Political Uncertainty Will Plague Europe Throughout 2019 was originally published on Global Security Review.

The Global Financial Crisis of 2008 left Spain scrambling to reassemble a broken economy and combat soaring unemployment. European austerity measures and Catalonian dreams of independence have since occupied all of Madrid’s bandwidth and effectively back-seated Spanish foreign policy for over a decade. With the rise of Pedro Sánchez and the wounds of the financial crisis healing, Madrid has turned its attention back to Brussels and is ready to assume the role of a leading power in Europe. 

With the unexpected departure of now Former Prime Minister Mariano Rajoy, the heavily pro-European Socialist Party (PSOE) has returned to power with a decidedly European agenda. In the months following the vote of no confidence that unseated Rajoy and installed Pedro Sánchez, the new Prime Minister embarked on a grand tour of Europe to court Spain’s closest partners in an effort to drum up support for Spain’s new European agenda.

During a visit to Paris, Sánchez spent several hours with President Emmanuel Macron discussing the French leader’s ambitious Eurozone reform project, from which Spain and other Southern European nations heavily impacted by the euro’s failings stand to benefit. As Rome embarks on a decidedly eurosceptic agenda for financial reform and migration policy of the E.U., Madrid is well-positioned to reclaim the mantle of leadership of the Southern bloc of E.U. member states.

Underscoring this new role, in June, Sánchez offered the ship Aquarius, carrying refugees from Northern Africa that were denied access at both Italian and Maltese ports, the opportunity to dock in Valencia. The Sánchez administration made clear that La Moncloa would carefully and thoroughly review each migrant for refugee status and provide them full protection under the law.

Sánchez’s actions not only signaled Spain’s willingness to take on a more active role but also rekindled the debate over E.U. migration policy and became the main topic of focus at the subsequent European Council meetings, held a few weeks later.

Spain has also taken a slightly more vocal role in debates over NATO defense spending, refusing to increase its military expenditure. The Sánchez administration argued that its contribution to NATO is not limited to its defense budget but comprises its considerably large aid, development, and human rights initiatives as well.

Though the government maintained a respectful tone of disagreement — wary of provoking an unnecessary conflict with Washington — it is a notable shift in the rhetoric Spain has traditionally used with Europe’s closest ally. The notably more vocal and engaged Sánchez administration suggests a more active Spanish presence on the world stage.

As the United Kingdom prepares to withdraw from the European Union and Eastern European states continue to butt heads with Brussels, Spain’s position as a large and active pro-European voice in the E.U. is a welcome prospect. It is also an opportunity — one that Madrid should approach with vigor and enthusiasm.

Seizing the Mantle of Leadership Under Sánchez

Spain is a unique outlier in Europe these days—it has no eurosceptic or far-right parties in Congress, its political leadership remains enthusiastically pro-European, and it has a welcoming domestic attitude towards immigration.

Sánchez’s PSOE is also one of just three social democratic parties in power in E.U. states, alongside Portugal’s PSD and Germany’s SPD. This leaves Madrid in a position with great potential to influence European policy and claim its place amongst Paris and Berlin as a leading European power within the EU.

Given Prime Minister Sánchez’s prior working experience within European Union institutions, his fluency in English and French, and the appointment of strong and respectable cabinet members, in particular Foreign Minister Josep Borrell, there is considerable room for engagement with President Macron and Chancellor Merkel to advance European reforms and take on a leading role in European foreign policy.

Both Spain and Portugal maintain strong, positive diplomatic ties to Latin America, where the EU has recently shifted its attention, opening the door for trade negotiations with MERCOSUR after finalizing a new free trade agreement with Mexico in April. As Lisbon shares a strong, pro-European attitude and views Spain as its closest working partner in the EU, Spain can expect to enjoy the collective weight of Iberia backing its European agenda and policy initiatives.

Spain also maintains an active presence in the Sahel region of Northern Africa and is a member of the Western Mediterranean Forum. Commonly referred to as the 5+5 Dialogue, it brings together the European five — Spain, Portugal, France, Italy, and Malta — with the North African states of Morocco, Mauritania, Algeria, Tunisia, and Libya.

The dialogue aims to provide a space to “discuss subjects of topical interest for the region and to identify new areas for practical cooperation.” As terrorism and forced migration continue to plague the Sahel and Central Saharan regions, Spain should increase its diplomatic and security engagement with its partners in Mali, Morocco, and Mauritania.

With Brussels still hamstrung on European migration policy, it is incumbent upon Spain to engage with its partners in the Mediterranean to lead European efforts to strengthen North African rule of law and economic development. This could be done most effectively by providing civil support for elections monitoring and establishing working groups at both the national and local levels in the region. In particular, Spain should boost its support for the democratization and economic development of Tunisia, the sole surviving democracy of the Arab Spring, which could serve as a politically stable economic anchor for its neighbors.

As the United States withdraws its support for the advancement of democracy and human rights, Spain should also take the opportunity to leverage its strong human rights record, and take a more active role, both individually and within the framework of the United Nations. Here, Madrid can again leverage its relations with Ibero-American states, many of which are also strong supporters of the UN, human rights, and democratic principles. 

By working closely with its Latin American allies, especially within the scope of collective principles and values, Spain and Portugal can begin to forge a new transatlantic alliance with Latin America. Greater cooperation along these lines would not only help Brussels win new allies to preserve the liberal world order from which it has benefitted, but also win Madrid greater influence in both continents as a focal point in the relationship.

Spain has also developed a strong working relationship with China. As a recent paper from the leading Spanish think tank, Real Instituto Elcano pointed out, technological collaboration has become a major component of Sinohispanic relations. Spain should encourage further collaboration within the framework of European collective policy towards China and develop a joint strategy with Beijing for future scientific and technological collaboration.

Capitalizing upon stronger bilateral ties, Madrid can then better position itself to negotiate with China over issues of broader concern to the European Union, such as combatting climate change, encouraging multilateralism, and supporting E.U.-Chinese collaboration on the JCPOA and the Belt and Road Initiative.

Sánchez and his successors might also find a willing partner in Beijing to advance its own agenda for economic development and stabilization in Northern Africa given the high level of foreign direct investment (FDI) that Xi’s administration has funneled into African development projects.

By developing a stronger working relationship with Beijing, Madrid may also find itself better positioned to check Chinese human rights violations and security-compromising FDI in Europe. In any case, Spain will need a more comprehensive strategy to address the world’s largest economy and rising global power.

Cultivating Staying Power for Spain

For all the potential for evolution into one of Europe’s leading powers, there is still the risk of Spain devolving into internal crisis. The issue of Catalonian independence is far from resolved, and political leaders are divided on how to address it.

There is also the potential for Spain to fall back into financial chaos if issues over Eurozone reform are not addressed in time for the next global economic shockwave. Yet Spain remains the best candidate for the vacancy left by the United Kingdom and Italy in the European triumvirate.

For Spain to cultivate staying power in the role, however, Sánchez will need to work closely and assertively with Macron to address Eurozone reform and establish greater solidarity with the EU states most affected by the last financial crisis. It will also have to demonstrate a willingness to compromise with the Visegrad states over issues of ongoing integration.

Madrid should also continue to opt into organizations for greater defense cooperation and collectivization such as PESCO and the European Intervention Initiative to gain influence and encourage other EU states to follow suit.

At the moment, Spain, like Portugal remains inoculated against eurosceptic right-wing political extremism that has plagued Germany and France due to the strong living memories of life under the Salazar-Caetano and Franco dictatorships. While this buttresses Spain’s leadership credibility, Madrid should not become complacent. After all, only a few years ago it was nearly unthinkable that Germany would become host to an active and growing far-right, eurosceptic movement. 

Short of Brussels developing political savvy in communicating with the wider European public overnight, politicians from all Spanish parties should continue to engage in public diplomacy efforts to engage the Spanish public with the rest of Europe and help make European Union institutions, Spanish representation, and policymaking at the EU level more transparent.

As Spain emerges as a third leading power in the European Union, it should seek to actively expand its influence within and beyond Europe. Madrid must not shy away from the role of leader but embrace the opportunity to redefine its place within Europe and the world to secure its future and preserve the European project.

The New European Triumvirate: Spain as a Leading Power in the European Union was originally published on Global Security Review.