Ukraine, Schengen and the EU economy: Luxembourg has taken stock of European policy for 2025
The Luxembourg government has published its annual report on European policy, summarising the key events and decisions of the European Union in 2025. This is the nineteenth such report and highlights issues that were of particular importance to the Grand Duchy during the year.
The report’s main topics include the ongoing war in Ukraine, the situation in the Middle East, efforts to boost the competitiveness of the European economy, EU trade policy and the future of the Schengen Area.
Support for Ukraine remains a priority
The report notes that Russia’s war against Ukraine entered its fourth year in 2025. Support for Ukraine remained one of the central issues at European Union level. Luxembourg continued to support the EU’s sanctions policy towards Russia and endorsed all 19 packages of sanctions adopted to date. In addition, the country continued to provide political, humanitarian, military and financial assistance to Ukraine.
The Middle East remains in the spotlight
A separate section is devoted to the situation in the Middle East. Against a backdrop of continuing instability, the European Union has been involved in efforts to stabilise the region throughout the year. As noted in the report, Luxembourg advocated maintaining dialogue between the parties to the conflict, whilst drawing attention to the serious humanitarian situation in the region.
The EU is seeking new trade opportunities
Against a backdrop of rising protectionism and unfair trade practices in the global economy, the European Union has stepped up its efforts to diversify its trade links.
Luxembourg has backed the EU’s approach of expanding international trade partnerships whilst safeguarding sensitive sectors of the economy, including agriculture.
Less red tape – greater competitiveness
One of the key priorities of European policy in 2025 was the simplification of the European Union’s regulatory framework. According to the Luxembourg government, reducing the administrative burden on businesses should be a key tool for enhancing the competitiveness of the European economy and stimulating growth in the single market.
The report highlights that Luxembourg has actively supported initiatives to streamline regulation and modernise European legislation.
40 years of the Schengen Agreement
A significant event in 2025 was the 40th anniversary of the signing of the Schengen Agreement, which was marked on 14 June. The document notes that freedom of movement remains one of the most notable achievements of European integration for EU citizens. However, throughout the year, a number of countries continued to maintain internal border controls. Luxembourg consistently advocated compliance with Schengen rules whilst seeking practical solutions to mitigate the negative impact of border checks on residents of border regions and businesses. The report was prepared by the Luxembourg Ministry of Foreign and European Affairs, Defence, Cooperation and Foreign Trade as part of the government’s regular engagement with the Chamber of Deputies on European policy matters.
