22. The Policy Watch

The Policy Watch is a weekly update which aims to provide concise insights into the current policy landscape. Tailored for our members and individuals interested in international affairs, this update offers a brief yet comprehensive summary of key developments affecting policy decisions and political trends in the UK, Sweden, and the EU.

GENERAL ELECTIONS WILL BE HELD ON 4 JULY

On Wednesday, Prime Minister Rishi Sunak officially announced general elections to be held on 4 July. The Parliament was suspended on Friday and will formally shut down on Thursday, 30 May, before the official five-week election campaign.

As of 27 May, Labour (45%) has a 22-point lead over the Tories (23%), according to Politico’s Poll of Polls for the UK.

LEADERS LAUNCH INTERNATIONAL AI SAFETY NETWORK

On 21 May, global leaders agreed to establish an international network of AI Safety Institutes to advance the science of AI safety, based on the UK’s initiative from November last year. The agreement, signed by 10 countries and the EU at the AI Seoul Summit, aims to promote collaboration on research, standards, and testing to ensure AI development is safe and responsible. The Seoul Declaration highlights the commitment to developing AI that is trustworthy and capable of addressing global challenges.

UK ECONOMY NEARS SOFT LANDING AFTER RECESSION

The UK economy is on the verge of a ‘soft landing’, with faster-than-anticipated growth following a mild recession in 2023, according to the IMF. Inflation is decreasing quicker than expected and is projected to meet the Bank of England’s 2% target by early 2025, while the central bank is advised to cautiously balance rate cuts to avoid economic risks.

Although fiscal policies have tightened, the IMF highlights the need for difficult decisions to stabilise public debt amidst pressures on public services and necessary investments.

NEW NUCLEAR PLANT PLANNED FOR NORTH WALES

The UK Government has identified Wylfa in Anglesey as the preferred site for a new large-scale gigawatt nuclear power plant, aiming to bolster the nation’s energy security and economic prosperity. Talks have commenced with international energy companies to develop the site, potentially providing power for six million homes and creating thousands of jobs. This project aligns with the UK’s ambition to significantly increase its nuclear capacity by 2050.

SWEDISH FOREIGN MINISTER CAUTIOUS WHEN COMMENTING ICC’S DECISION ON ISRAEL AND HAMAS

Swedish Foreign Minister Tobias Billström addressed the ICC prosecutor’s request for arrest warrants against Israel’s Prime Minister and Defence Minister, and three Hamas leaders, stating it is ultimately the court’s decision. Following widespread criticism from Western leaders, Billström noted the complexity of addressing cases involving both a terrorist organisation and a democratic state but emphasised Sweden’s commitment to the multilateral system.

EU PUSH FOR MORE SWEDISH MINES FACES LOCAL RESISTANCE

The EU is urging Sweden to open more mines to secure essential metals for the green transition and reduce reliance on Chinese imports, but local municipalities are resisting. In Vittangi, despite significant graphite deposits, the local council has rejected plans for a new mine due to environmental concerns. Similar opposition is seen in Åre and Hudiksvall, reflecting a broader national debate on balancing mineral extraction with environmental and community impacts.

COUNCIL GIVE SEVERAL FINAL APPROVALS

The Council has formally adopted several legislations, including;

• the Net-Zero Industry Act, aimed at strengthening Europe’s net-zero technology manufacturing ecosystem,
• regulation on tracking and reducing methane emissions, a part of the ‘Fit for 55’ package,
• the ecodesign regulation, which sets requirements for sustainable products,
• new rules aimed at improving the safety and quality of blood, tissues and cells used in healthcare and facilitating cross-border circulation of these substances in the EU,
• and, the Corporate Sustainability Due Diligence Directive, introducing obligations for large companies regarding adverse impacts of their activities on human rights and environmental protection.

EU EXPANDS AI SUPERCOMPUTING CAPABILITIES

The Council has reached a political agreement to expand the objectives of the EuroHPC Joint Undertaking, focusing on developing AI Factories to enhance Europe’s artificial intelligence ecosystem. The regulation aims to provide AI supercomputing services to innovative European startups and SMEs, with financial support for up to 50% of the acquisition and operating costs of AI-optimised supercomputers. The agreement, awaiting publication in the Official Journal, seeks to bolster the EU’s technological autonomy and competitiveness in AI.