Welcome to the weekend issue of Brussels Edition, Bloomberg’s daily briefing on what matters most in the heart of the European Union. Join us on Saturdays for deeper dives from our bureaus across Europe.

BUCHAREST — All politics is local, but sometimes it’s hard to replicate local wins at the national level.

That’s the challenge facing Romania’s new prime minister, Ilie Bolojan, who cut his political teeth as a small-city mayor and is now leading this EU nation of 19 million people.

The good news is that Romania finally has a government after months of political turmoil. The country has been gripped by political drama after last December’s shock victory of candidate Calin Georgescu.

The result was annulled by the country’s top court, citing outside interference. A re-run in May saw pro-EU candidate Nicusor Dan emerge victorious as president. 

Nicusor Dan, Romania's president, left, and Ilie Bolojan, Romania's prime minister, right, in Bucharest. Photographer: Daniel Mihailescu/AFP

Dan nominated Bolojan as prime minister, who was sworn in this week as head of a four-party government. Now the hard work begins.

Romania’s public finances are in bad shape. The country, which joined the EU in 2007, has one of the largest budget deficits in the bloc, and is bracing itself for a possible credit rating downgrade to junk status. The European Commission has also threatened to suspend EU funds to the country if it doesn’t address its gaping budget deficit of 9.3% of GDP.

The new prime minister has a strong track record when it comes to cleaning up public finances. Dubbed the “killer” by a political ally in parliament, Bolojan successfully turned around the economy of the western city of Oradea while mayor.

Replicating that model in Bucharest may be a much more difficult task. Scaling back the budget deficit will require a combination of spending cuts and tax increases – moves that risk stoking rifts in Romanian society.

The recent presidential election was a reminder of the significant support that exists for far-right candidates, pointing to growing discontent with mainstream parties in Romania.

US Vice President JD Vance recently weighed-in on the election results, attacking the country’s court for canceling the election in December and accusing mainstream politicians of stifling free speech.

So far, the US administration has had little to say about the new government that took office in Bucharest this week.

For Bolojan’s part, he pledged in his first speech after taking office this week “to show respect to the people” as he aims to keep the public on board ahead of some difficult decisions.

-- Andra Timu, Bucharest reporter 

Weekend Reads

European Allies Wary of Buying American as They Plan Defense Buildup

For European countries that just approved the biggest increase in military spending in decades, “Buy American” is looking a lot less appealing than it once was. They may have no choice. The US lead in key areas, especially missiles and other high-tech weapons, means there’s often no real alternative to buying American, despite efforts to ramp-up the European defense sector. 

One of Germany’s Newest Protected Monuments Is a Coal Plant

Cooling towers release vapor at the Jänschwalde coal-fired power plant. Photographer: Krisztian Bocsi/Bloomberg

Germany’s Jänschwalde coal plant was on track to be converted to natural gas — until the local heritage office declared it a national monument. The 1970’s power plant, a vestige of the communist era, was added to the register of protected sites. The regional office for monument preservation described the plant as “an important element of the industrial culture of Lusatia.”

Ireland’s Firms Brace for Economic Hit With Quiet Confidence

Hundreds of companies, 200,000 jobs, billions of euro in corporation tax revenue. Add it all up and Ireland’s reliance on US investment for its economic success is starkly clear. While it’s one of the most vulnerable countries to Donald Trump’s efforts to rewrite global trade, there’s a quiet confidence in its financial sector and economy.

Wealthy Europeans Lured by Tax Havens Face Surge in Exit Charges

The wealthy are exiting the UK in droves for tax havens such as Monaco, Switzerland and Dubai. But many well-heeled Europeans with similar dreams of escape are finding they can’t leave quite so easily. High-tax nations across the continent are seeking to slow the departure of rich residents by hitting them with a levy on the value of their assets when they depart. 

Turkey Steps Up Race Against Australia to Host COP31 Talks

As divisions in Europe emerge over the EU’s plan to announce a new 2040 climate target next week in Brussels, Turkey is stepping up its efforts to host next year’s COP climate talks.  This week it touted its climate credentials as it made a pitch, potentially scuppering Australia’s desire to host the 2026 COP talks in Adelaide. 

Recep Tayyip Erdogan, Turkey's president, at the COP29 climate conference in Baku, Azerbaijan in 2024. Photographer: Hollie Adams/Bloomberg

This Week in Europe

• Wednesday: European Commission scheduled to propose 2040 climate goal
• Thursday: Commissioners visit Denmark for the start of Denmark’s EU presidency
• Friday: EU-Moldova summit in Chisinau, Moldova