RTL Today - Your Weekly Recap: Luxembourg and EU defence boost, Trump address to Congress, and another major drug bust

Your Weekly Recap for 3–7 March 2025.

Here are five things you should know at the end of this week:

Luxembourg targets 2% GNI defence budget as European security shifts
STATEC forecasts next wage indexation in second quarter of 2025
Luxembourg sees largest air freight drug bust in history
EU unveils €800 bn defence plan after US policy shift
Trump declares ‘America is back’ in divisive speech to US Congress

@rtl.today Here are the top five news stories in Luxembourg this week. #luxembourgnews #newsinluxembourg #luxembourg #weeklyrecap #rtltoday #todayradio ♬ original sound - Today Radio Luxembourg by RTL

1. Luxembourg targets 2% GNI defence budget as European security shifts

Luxembourg MPs and ministers stress increased defence spending in response to geopolitical tensions, aiming to reach NATO’s 2% GNI target by 2030 while balancing fiscal responsibility.
PM Luc Frieden backs EU defence initiatives amid shifting US support for Ukraine, emphasising European security independence while Luxembourg's financial contributions remain unclear.

Finance Minister Gilles Roth has meanwhile warned that increased defence contributions need to be balanced to not endanger social cohesion in the Grand Duchy.

Balancing act – The Luxembourg government and parliament are aligning with broader European calls for increased defence investments amid shifting geopolitical realities, particularly due to the ongoing war in Ukraine. Prime Minister Luc Frieden and Defence Minister Yuriko Backes have both underscored the necessity of reaching NATO's target of 2% of Gross National Income (GNI) for defence by 2030, though details on how this will be achieved remain unclear.

No specifics – Amid concerns over declining US support for Ukraine, Luxembourg Prime Minister Luc Frieden has voiced strong support for European-led defence initiatives while maintaining that Luxembourg's role will remain within its capabilities. Following a high-level summit in Brussels, Frieden acknowledged the European Commission's €800 billion defence investment as a necessary step toward reinforcing European sovereignty and military coordination.

However, he stopped short of specifying Luxembourg's financial contributions, indicating that discussions will continue until the NATO summit in the summer. Frieden also emphasised the importance of a unified European approach but suggested that if consensus cannot be reached, the majority of EU nations should proceed without holdouts like Hungary and Slovakia.

Social cohesion – Finance Minister Gilles Roth has suggested that while Luxembourg will prioritise defence, it must also safeguard its fiscal stability, social cohesion, and international credit rating. Some MPs, including those from The Greens and the Luxembourg Socialist Workers' Party (LSAP), have called for stronger European military coordination, while others, like the ADR, question whether the public would support large-scale increases in defence spending.

2. STATEC forecasts next wage indexation in second quarter of 2025

Luxembourg's next wage indexation is expected in Q2 2025, according to a new STATEC report.
Annual inflation dropped slightly from 1.9% to 1.7%, despite a 1.2% rise in consumer prices in February.
February's price increases were driven by seasonal factors, with clothing (+15.5%) and leisure activities (+4%) seeing notable hikes.

Maintaining purchasing power – Luxembourg's National Institute of Statistics and Economic Studies (STATEC), released its latest economic forecast, indicating that the next wage indexation – the automatic salary adjustment linked to inflation – will likely be triggered in the second quarter of 2025. The indexation is designed to help workers maintain their purchasing power by adjusting salaries in response to rising consumer prices.

Broader stabilisation – The report highlighted a modest easing in inflation, with the annual rate falling from 1.9% to 1.7%, even as consumer prices saw a noticeable jump in February. The decline in inflation suggests a broader stabilisation in price levels, though short-term fluctuations remain. The 1.2% increase in the consumer price index for February indicates that while inflationary pressures persist, they may be driven more by temporary factors rather than a sustained trend.

Seasonal variations – STATEC attributed the February price surge to seasonal effects, particularly the conclusion of winter sales, which led to a sharp rise in clothing and footwear prices, up by 15.5%. Other sectors also saw increases, including leisure and cultural activities (+4%) and household goods and maintenance (+1%). Additionally, the demand for plants and flowers around Valentine’s Day contributed to a 7% price increase in this category.

3. Luxembourg sees largest air freight drug bust in history

Luxembourg authorities seized 508kg of cocaine worth nearly €100 million at Findel Airport’s Cargo Center, the largest air freight drug bust in the country’s history.
The shipment, arriving from Brazil and labeled as tapioca, concealed the drugs within 3.6 tonnes of starch across five pallets.
The judicial police and public prosecutor are investigating, following another major cocaine bust weeks earlier at a farm in northern Luxembourg.

Another major bust – Luxembourg authorities conducted a significant drug bust at Findel Airport's Cargo Center, seizing 508 kilograms of cocaine with an estimated street value of nearly €100 million. This marks the largest air freight drug seizure in the country's history, highlighting growing concerns over drug trafficking routes through Luxembourg. The bust was carried out by customs officials, who routinely monitor shipments for suspicious activity.

Suspicious transport route – The shipment originated from Brazil and was falsely labelled as tapioca in an attempt to avoid detection. Upon further inspection, customs officers discovered that the drugs were hidden within 3.6 tonnes of food-grade starch, meticulously spread across five pallets. The unusual transport route of the cargo initially raised suspicion, prompting authorities to conduct a detailed examination, which ultimately led to the discovery of the concealed narcotics.

Investigation launched – The case is now under investigation by the Grand Ducal police's judicial service in collaboration with the public prosecutor, who has launched a formal enquiry. This seizure follows another major drug bust just weeks ago, in which several hundred kilograms of cocaine were found hidden inside cylinders within a stone-crushing machine at a farm in northern Luxembourg, suggesting an increasing pattern of large-scale drug smuggling attempts in the country.

4. EU unveils €800 bn defence plan after US policy shift

EU leaders pledged to bolster European defence with an €800 billion plan amid concerns over US disengagement from NATO and Ukraine, as Trump seeks a ceasefire with Russia.
Zelensky, after a fallout with Trump, sought renewed US cooperation while EU leaders reaffirmed support for Ukraine, though no major new aid was announced.
Britain and France pushed for a one-month truce and a "coalition of the willing" to mediate peace, while Russia rejected European troops in Ukraine, insisting on a final settlement.

Major defence investment – At an emergency summit in Brussels, European Union leaders committed to strengthening the bloc's defence in response to growing uncertainty about US support for NATO and Ukraine. The plan includes easing fiscal rules to allow higher military spending and providing EU-backed loans of up to €150 billion for member states.

French President Emmanuel Macron advocated extending France's nuclear deterrent to European partners, while Germany's chancellor-in-waiting, Friedrich Merz, backed radical reforms to finance the country's rearmament. This move comes as Trump signals a shift away from transatlantic commitments, questioning US contributions to NATO and pursuing a ceasefire deal with Russia, raising concerns that Ukraine may be pressured into an unfavourable settlement.

Europe united – Following a contentious exchange with Trump that resulted in the US cutting off military aid and intelligence sharing with Kyiv, Ukrainian President Volodymyr Zelensky travelled to Brussels to secure continued European support. EU leaders reassured him of their backing and emphasised that any negotiations on Ukraine's future must include Kyiv's participation.

Despite the strong statements of solidarity, no new major aid packages were pledged, with some European states arguing that existing commitments were sufficient. However, Norway, though not an EU member, announced a significant increase in its aid to Ukraine, bringing its 2025 contribution to $7.8 billion.

Putin opposes European peace troops – Seeking to de-escalate the conflict, British Prime Minister Keir Starmer and French President Emmanuel Macron proposed a temporary ceasefire covering air, sea, and energy infrastructure, hoping to create momentum for broader negotiations. They also advocated for a "coalition of the willing", engaging around 20 nations to help broker a peace deal.

Meanwhile, US envoy Steve Witkoff announced plans to meet Ukrainian negotiators in Saudi Arabia to discuss an initial ceasefire and a long-term agreement framework. However, Russia firmly opposed any European troop deployments in Ukraine and dismissed the idea of a temporary truce, insisting that only a comprehensive and final settlement could resolve the conflict.

5. Trump declares ‘America is back’ in divisive speech to US Congress

President Donald Trump's first address to Congress since returning to power was a record-breaking one hour and 40 minutes, filled with Republican cheers, Democratic protests, and reality TV-style moments, including honouring a young cancer patient and highlighting Elon Musk's role in his administration.
Democrats showed strong opposition, with walkouts, silent protests, and heckling over policies on women's rights, immigration, and Ukraine, while Trump pushed his agenda on bureaucracy cuts, tariffs, and a controversial pivot towards Russia.
Trump declared "America is back", praised his administration's radical changes, and announced Ukraine's willingness to negotiate with Russia, while also making bold foreign policy claims, including acquiring the Panama Canal and Greenland.

Back in style – President Trump delivered the longest presidential address to Congress on record, clocking in at one hour and 40 minutes, blending traditional political rhetoric with his signature showmanship. The speech was met with overwhelming enthusiasm from Republicans, who frequently erupted in standing ovations and chants of "USA".

Meanwhile, Democrats responded with protests, walkouts, and stony silence. Trump leaned into his reality TV instincts, orchestrating emotionally charged moments, such as inviting a young cancer patient on stage and granting him honorary Secret Service status. The presence of Elon Musk, whom Trump twice praised, added another spectacle element to the night, as cameras frequently panned to the billionaire seated in the gallery.

Protests and praise – Democrats expressed their opposition in various ways, from silent protests to outright confrontations. Many wore pink in defiance of Trump's alleged anti-women policies, while others displayed signs reading "False" and "Musk steals" in reference to Trump's endorsement of Musk's radical restructuring of the federal government.

Some lawmakers, including Al Green, were ejected for vocal disruptions, and others left the chamber in protest. Trump made no effort to bridge the political divide, instead using his speech to rail against diversity programmes, immigration, and what he called an economic "catastrophe" caused by his predecessor. He pledged to escalate his trade war with key US partners and intensify crackdowns on Mexican drug cartels, dismissing concerns about economic repercussions.

Determined and defiant – Trump declared "America is back", celebrating his administration's rapid and controversial changes, including deep cuts to federal agencies, thousands of government job terminations, and a significant rollback of foreign aid. He highlighted his close alliance with Musk, who has played a key role in restructuring federal operations, and dismissed concerns about his popularity slipping due to inflation and trade disruptions.

In foreign policy, Trump shocked many by announcing that Ukrainian President Volodymyr Zelensky had agreed to negotiations with Russia, following a tense Oval Office meeting. He also revived long-dismissed proposals, such as reclaiming the Panama Canal and acquiring Greenland from Denmark, emphasising that his administration would pursue these goals "one way or another".

The best of... 📚

Business & Tech – European Central Bank chief Christine Lagarde warned Thursday the eurozone faces "risks all over" amid US tariff threats and massive German spending plans, as policymakers cut rates again but signalled future monetary easing was in doubt.
Science & Environment – Europe's new Ariane 6 rocket successfully carried out its first commercial mission on Thursday, placing a French military satellite into orbit to give the continent a new independent access to space.
Entertainment – Canadian electronic music producer deadmau5 has sold his extensive music catalogue and that of his label, mau5trap, to Create Music Group in a $55 million deal, marking a major shift in the electronic music industry.
Sport – FIFA on Wednesday announced it will pay total prize money of $1 billion to participants in the Club World Cup taking place in the United States this year.

And in case you missed it... ⚠️

Caritas case – The Caritas special commission has extended its investigation deadline until National Day, allowing more time to hear from key stakeholders involved in the €61 million misappropriation, despite differing views on the commission's role in investigating responsibility.
Email scandal – Opposition politicians in Hesperange have condemned Mayor Marc Lies after a leaked email revealed disparaging remarks about them, deepening divisions in the local council.
Culture – The Luxembourg City Film Festival kicked off on Thursday, featuring exclusive premieres, high-profile guests, and a diverse lineup of films, documentaries, and special events.
Royals – Replacing Paul Dühr, former diplomat and Luxinnovation director Sasha Baillie has been appointed Marshal of the Grand Ducal Court, having been sworn in on Monday in the presence of Grand Duke Henri and Hereditary Grand Duke Guillaume.

Your Weekly Recap is published every Friday at noon. Read earlier versions.