Exclusive: EU Commission to defend Spain in €106 million US energy lawsuit
Copyright AP Photo / Manu Fernandez
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When firm Blasket Renewables sought to enforce compensation in a US court, the European Commission argued that Spain could not legally pay it, highlighting a clash between international arbitration and EU law.
The European Commission is seeking permission from the European Council to defend Spain from a €106 million lawsuit brought in a US court under the Energy Charter Treaty (ECT) which could put Madrid in breach of EU state aid rules, according to a document seen by Euronews.
The ECT is a post-Cold War international agreement designed to protect investments in unstable, formerly communist states. It has since become a source of controversy because it allows energy companies to sue countries for measures that could harm their expected profits.
While the legal case is binding and can generally be enforced in courts under international investment treaty rules, the European Union argues that Spain could face conflicting legal obligations – at home and abroad – if a US court orders enforcement.
After Spain rolled back the state aid scheme set up in 2007 to promote electricity generation from clean power sources, the Japanese investor Eurus Energy claimed losses under the ECT and won the right to compensation, with Spain ordered to pay €106 million plus interest in November 2022.
The legal proceedings were initiated by the International Centre for Settlement of Investment Disputes (ICSID), an arbitral tribunal linked to the World Bank, which manages legal disputes between international investors and countries worldwide.
In 2023, Spain challenged the compensation award, but ultimately failed.
Between a rock and a hard place
Eurus then assigned the case to Blasket Renewables, described in the document as a US-based “vulture fund” specialising in difficult-to-enforce arbitration compensation, effectively seeking enforcement through US courts.
"The Kingdom of Spain has informed the Commission that Blasket Renewables has filed a petition seeking recognition and enforcement of the award before the courts of the United States," reads the document.
The Commission argues that if Spain "compensates investors for losses incurred due to the repeal of the 2007 State aid scheme", it amounts to state aid, meaning financial support that a government gives to a company or investor.
But investors seeking compensation disagree, arguing that the payments are not government subsidies but compensation that Spain is legally required to pay after losing an international arbitration case.
Under EU rules, governments are not allowed to give special benefits to particular businesses if doing so would give them an unfair advantage over competitors, unless the support has been approved by the Commission.
The legal case highlights a clash between two legal systems, each asserting that its rules should prevail. International arbitration holds that Spain must pay, while the Commission says that making the payment could breach EU rules.
"Where aid is granted in violation of that provision, the beneficiary cannot have any legitimate expectations in being allowed to keep that aid, and the member state is obliged to recover it ex officio," reads the document, implying that the Spanish government would need to act accordingly.
The Commission considers that foreign courts' recognition and enforcement of such financial compensations is "incompatible with EU law" and would undermine "the primacy of EU law," which the EU executive sees as "unenforceable".
'Vulture funds' versus Spain
The Spanish Energy Ministry said that arbitral proceedings between international investors and Spain over renewables are the result of decisions made by the previous Spanish government, particularly in 2013 under former conservative Prime Minister Mariano Rajoy.
Madrid added that the majority of final arbitrations linked to renewable energy investments are in the hands of litigation funds, which have acquired the rights to the original plaintiffs, the main one being Blasket Renewable Investments.
"They are not the companies affected; they have purchased debts against Spain and try to enforce them abroad, filing the same cases in different countries," reads an Energy Ministry statement.
Paul de Clerck, economic justice coordinator at the NGO Friends of the Earth Europe, said this legal case was the "perfect illustration of the absurdity" of international state dispute settlements (ISDS).
He argued that if an investor doesn’t agree with a Spanish decision, it should go to the normal Spanish courts and not to a "business-friendly tribunal".
"Vulture funds are further misusing the system by buying up claims to make profits at the expense of tax payers," de Clerck told Euronews.
"It is high time that this comes to an end and that the EU and member states take ISDS out of all of their investment treaties."
June 3, 2026
Congressional Research Service (CRS).
By Derek E. Mix
Summary
Relations between the United States and Spain have experienced tensions during the second Trump Administration. Over the past several decades, the two countries have had extensive cultural ties, shared a mutually beneficial economic relationship, and cooperated closely on numerous diplomatic and security issues. Spain has been a member of NATO since 1982 and a member of the European Union (EU) since 1986. Some Members of Congress may have an interest in Spain’s internal political situation and relations with the United States.
Political Situation
Prime Minister Pedro Sánchez of the center-left Socialist Workers’ Party (PSOE) has led the government of Spain since 2018. PSOE formed a minority coalition government with Sumar, an alliance of left-wing parties, following Spain’s 2023 election. The government relies on parliamentary support from smaller regional parties to pass legislation. The center-right Popular Party (PP) and the far-right party Vox are the main opposition parties. The next election is due by August 2027. King Felipe VI is Spain’s head of state.
U.S.-Spain Tensions
Prime Minister Sánchez has been a leading European critic of the Trump Administration’s foreign policy. The Sánchez government has expressed opposition to the U.S. military operation against Iran that began in February 2026 and denied the use of military bases in Spain to U.S. forces involved in strikes against Iran. The Trump Administration has strongly criticized Spain’s position, and President Trump has threatened to “cut off all trade” with Spain in response.
At NATO’s 2025 summit, Spain was the only member of the alliance not to commit to spending 5% of gross domestic product on defense by 2035 (3.5% on core defense requirements, such as equipment and personnel, and 1.5% on defense- and security-related spending, such as critical infrastructure, civil preparedness, and a strong defense industrial base). President Trump strongly criticized Spain’s position.
Security and Defense Relations
Spain has played an important role in U.S. defense strategy for Europe, Africa, and the Middle East. Five U.S. destroyers equipped with the Aegis Ballistic Missile Defense system are based in Spain, and the United States also has access to an air base in Spain. Historically, the United States and Spain have cooperated closely on counterterrorism. Spanish forces participated in the NATO-led missions in Afghanistan for nearly two decades.
Economic Relations
Two-way direct investment between the United States and Spain totaled more than $121 billion in 2024, with Spanish investment in the United States accounting for nearly three-quarters of that total. U.S.-Spain trade in goods and services was valued at nearly $75 billion in 2025, and the United States had a trade surplus of almost $3 billion.
Selected Foreign Policy and Security Issues
Spanish armed forces participate in more than a dozen international peacekeeping and security operations, including NATO and EU missions and the United Nations peacekeeping mission in Lebanon.
Following Russia’s 2022 full-scale invasion of Ukraine, Spain has provided Ukraine with military, financial, and humanitarian assistance and supported EU sanctions against Russia. Spain hosts more than a quarter of a million Ukrainian refugees.
Relations between Spain and Israel have been strained over the past several years. Spanish officials criticized Israel’s military operations in Gaza and against Iran. In 2024, Spain formally recognized a Palestinian state based on pre-1967 borders.
The Sánchez government has deepened Spain’s ties with the People’s Republic of China (PRC, or China). Sánchez has traveled to China four times in four years, and the two countries have signed numerous trade and cooperation agreements. Some analysts assert that Sánchez’s approach to China is a strategy to diversify Spain’s economic ties in the context of tensions with the United States over tariffs and foreign policy issues.
Introduction and Issues for Congress
For decades, U.S. policymakers have considered Spain to be an important U.S. ally. Political developments in Spain, U.S.-Spain political relations and security cooperation, and U.S.-Spain economic ties are possible topics of continuing interest to the 119th Congress. Some Members of Congress may have an interest in foreign and defense policy debates that have affected U.S.-Spain relations during the second Trump Administration. Members of Congress may consider current issues in U.S.-Spain relations in the course of oversight or legislative activities or in the context of direct interactions with Spanish legislators and officials.
The Congressional Friends of Spain Caucus is a group of Members of Congress who seek to enhance U.S.-Spain relations and promote political, economic, and social ties between the two countries.1 The U.S.-Spain Council, founded in 1996, brings together U.S. and Spanish leaders to promote economic, educational, and cultural ties. The current honorary chair is Senator Ben Ray Luján. Six of the seven previous chairs were Members of the U.S. Senate or House of Representatives.2
Political Situation
Prime Minister Pedro Sánchez of the center-left Socialist Workers’ Party (PSOE) has led the government of Spain since 2018.3 Sánchez secured a new term in office following an early election in July 2023.4 The government formed by Prime Minister Sánchez after the 2023 election (see Figure 2) is a minority coalition government between PSOE and Sumar, an alliance of left-wing parties, and relies on parliamentary support from smaller regional parties. It is the second coalition government to lead Spain since the restoration of democracy in 1978.5
The center-right Popular Party (or People’s Party, PP), which led the government of Spain from 2011 to 2018, came in first place in the 2023 election, with 33.1% of the vote. The PP won 137 out of the 350 seats in the Congress of Deputies (lower house of parliament) but fell short of a parliamentary majority. PSOE came in second place, with 31.7% of the vote and 121 seats. The far-right party Vox came in third place, with 12.4% and 33 seats, and the Sumar alliance won 12.3% and 31 seats. Seven smaller regional parties won the remaining 28 seats.6
Following the election, Spain’s head of state, King Felipe VI, asked PP leader Alberto Núñez Feijóo to form a government, but Feijóo was unable to secure the votes needed to become prime minister. King Felipe VI subsequently asked Sánchez (who had remained as acting prime minister) to form a government. To do so, Sánchez needed support from regional parties that advocate independence for Spain’s Catalonia region (see “Spain’s Regions” section, below). To secure their support, Sánchez proposed a controversial law that would grant amnesty to hundreds of people charged with crimes related to separatist activities in Catalonia, including organizing an illegal independence referendum and independence declaration in 2017. The proposed amnesty law triggered large public protests and opposition from Spain’s right-wing parties, police, and judiciary.7 The Congress of Deputies approved the law by a vote of 177 to 172 in May 2024.8
For decades, U.S. policymakers have considered Spain to be an important U.S. ally. Political developments in Spain, U.S.-Spain political relations and security cooperation, and U.S.-Spain economic ties are possible topics of continuing interest to the 119th Congress. Some Members of Congress may have an interest in foreign and defense policy debates that have affected U.S.-Spain relations during the second Trump Administration. Members of Congress may consider current issues in U.S.-Spain relations in the course of oversight or legislative activities or in the context of direct interactions with Spanish legislators and officials.
The Congressional Friends of Spain Caucus is a group of Members of Congress who seek to enhance U.S.-Spain relations and promote political, economic, and social ties between the two countries.1 The U.S.-Spain Council, founded in 1996, brings together U.S. and Spanish leaders to promote economic, educational, and cultural ties. The current honorary chair is Senator Ben Ray Luján. Six of the seven previous chairs were Members of the U.S. Senate or House of Representatives.2
Political Situation
Prime Minister Pedro Sánchez of the center-left Socialist Workers’ Party (PSOE) has led the government of Spain since 2018.3 Sánchez secured a new term in office following an early election in July 2023.4 The government formed by Prime Minister Sánchez after the 2023 election (see Figure 2) is a minority coalition government between PSOE and Sumar, an alliance of left-wing parties, and relies on parliamentary support from smaller regional parties. It is the second coalition government to lead Spain since the restoration of democracy in 1978.5
The center-right Popular Party (or People’s Party, PP), which led the government of Spain from 2011 to 2018, came in first place in the 2023 election, with 33.1% of the vote. The PP won 137 out of the 350 seats in the Congress of Deputies (lower house of parliament) but fell short of a parliamentary majority. PSOE came in second place, with 31.7% of the vote and 121 seats. The far-right party Vox came in third place, with 12.4% and 33 seats, and the Sumar alliance won 12.3% and 31 seats. Seven smaller regional parties won the remaining 28 seats.6
Following the election, Spain’s head of state, King Felipe VI, asked PP leader Alberto Núñez Feijóo to form a government, but Feijóo was unable to secure the votes needed to become prime minister. King Felipe VI subsequently asked Sánchez (who had remained as acting prime minister) to form a government. To do so, Sánchez needed support from regional parties that advocate independence for Spain’s Catalonia region (see “Spain’s Regions” section, below). To secure their support, Sánchez proposed a controversial law that would grant amnesty to hundreds of people charged with crimes related to separatist activities in Catalonia, including organizing an illegal independence referendum and independence declaration in 2017. The proposed amnesty law triggered large public protests and opposition from Spain’s right-wing parties, police, and judiciary.7 The Congress of Deputies approved the law by a vote of 177 to 172 in May 2024.8
Figure 2. Results of 2023 Spanish Election, Congress of Deputies. Source: El País, “Elecciones Generales 2023.”
Note: Vote percentages rounded to the nearest tenth of a percentage point.
Priorities of the Sánchez government have included addressing income inequality and promoting socially progressive and green policies. In addition to the policymaking challenges of managing support from the regional parties, the Sánchez government has come under pressure due to corruption allegations against several government officials as well as the prime minister’s wife and brother.
The Sánchez government has taken a relatively welcoming approach to migration, viewing it as a means to boost Spain’s workforce and offset the country’s aging population. In January 2026, the government announced plans to legalize the status of approximately 500,000 undocumented migrants, provided they had lived in Spain for at least five months prior to the end of 2025 and did not have a criminal record. Successful applicants are expected to receive a one-year, renewable residence permit and would be eligible for citizenship after 10 years. More than half of the migrants in Spain originate from Central or South America; more than a quarter originate from countries in Africa.9
The next election is scheduled to occur by August 2027. In one aggregate of polls dated April 18, 2026, 32% of respondents expressed support for the PP, compared with 28% for PSOE, 17% for Vox, and 6% for Sumar.10
Spain is a parliamentary monarchy. According to the 1978 constitution, the king of Spain is the head of state. King Felipe VI succeeded to the throne in 2014 following the abdication of his father, King Juan Carlos I, who reigned for 39 years. The king is commander in chief of the armed forces and has formal roles in the legislative process and in appointing government officials. The king exercises limited political power, generally acting on the advice of the prime minister and refraining from interference in political matters.
Note: Vote percentages rounded to the nearest tenth of a percentage point.
Priorities of the Sánchez government have included addressing income inequality and promoting socially progressive and green policies. In addition to the policymaking challenges of managing support from the regional parties, the Sánchez government has come under pressure due to corruption allegations against several government officials as well as the prime minister’s wife and brother.
The Sánchez government has taken a relatively welcoming approach to migration, viewing it as a means to boost Spain’s workforce and offset the country’s aging population. In January 2026, the government announced plans to legalize the status of approximately 500,000 undocumented migrants, provided they had lived in Spain for at least five months prior to the end of 2025 and did not have a criminal record. Successful applicants are expected to receive a one-year, renewable residence permit and would be eligible for citizenship after 10 years. More than half of the migrants in Spain originate from Central or South America; more than a quarter originate from countries in Africa.9
The next election is scheduled to occur by August 2027. In one aggregate of polls dated April 18, 2026, 32% of respondents expressed support for the PP, compared with 28% for PSOE, 17% for Vox, and 6% for Sumar.10
Spain is a parliamentary monarchy. According to the 1978 constitution, the king of Spain is the head of state. King Felipe VI succeeded to the throne in 2014 following the abdication of his father, King Juan Carlos I, who reigned for 39 years. The king is commander in chief of the armed forces and has formal roles in the legislative process and in appointing government officials. The king exercises limited political power, generally acting on the advice of the prime minister and refraining from interference in political matters.
Spain’s Regions
The Spanish state consists of 19 provincial territories referred to as self-governing communities or autonomous communities.11 Two Spanish territories in particular, the Basque region and Catalonia (see Figure 3), maintain distinctive cultural identities. Politics in these regions features the strong presence of nationalist independence movements.
The Basque region is in north-central Spain, on the Bay of Biscay near the border with France. The separatist terrorist group Basque Fatherland and Liberty (ETA) waged a violent campaign against the central government starting in the 1960s, killing approximately 800 people between 1968 and 2010. In 2008-2009, ETA was weakened by arrests of key leaders and declared a ceasefire in 2011. All Basque nationalist parties subsequently renounced violence in favor of pursuing independence through politics. ETA formally moved to disarm in 2017 and announced its full dissolution in 2018.
Catalonia is in northeast Spain, on the Mediterranean Sea and the border with France, and includes Barcelona, Spain’s second-largest city. It is one of Spain’s wealthiest regions, accounting for nearly one-fifth of the country’s gross domestic product (GDP).12 In 2017, the regional government of Catalonia attempted to hold a unilateral referendum on independence, and the Catalan parliament held a vote for independence. The government of Spain condemned both actions as illegal and unconstitutional. The government subsequently triggered an article of the Spanish Constitution allowing it to dissolve the regional government and assembly of Catalonia and take direct control of the regional police force. Spain lifted the article in 2018 following a new regional election and the formation of a new regional government. In 2019, Spain’s Supreme Court found nine separatist leaders guilty of sedition and abuse of public funds and sentenced them to prison. In 2021, the Spanish government pardoned the nine separatist leaders and released them from prison. More than 300 other individuals stand to benefit from the 2024 amnesty law described above.
Polling indicates that support for independence in Catalonia has decreased since the 2017 separatist crisis. For example, one 2025 poll funded by the Catalan government found 37.6% in favor of independence and 54.1% opposed, compared with 49.4% in favor and 41% opposed in 2017.13 Some observers attribute lower support for independence to factors such as disillusionment with the aftermath of the 2017 crisis, political fatigue in relation to the separatist issue, and more pragmatic or conciliatory approaches by politicians on both sides having reduced tensions surrounding the issue.14
Economy
Spain is the world’s 15th-largest economy and the 4th-largest economy in the 27-member European Union (EU).15 Spain’s economy grew by 2.8% in 2025 and is forecasted to grow by 2.1% in 2026. Unemployment is forecast to be 9.8% in 2026.16 Spain’s economy has fluctuated over the past two decades. The COVID-19 pandemic interrupted what had been a sustained period of economic recovery following a prolonged downturn from 2008 to 2014. Prior to 2008, Spain had experienced more than a decade of strong economic growth. In 1999, Spain was among the first group of EU countries to adopt the euro as its currency.
The tourism sector accounts for more than 15% of Spain’s GDP; Spain is the world’s second-largest tourist destination behind France. Other important sectors of Spain’s economy include construction and real estate (combining for 15% of GDP) and automobile manufacturing (10% of GDP).17 More than 62% of Spain’s exports go to other EU countries, and nearly 57% of imports come from EU countries.18 Spain’s top trading partners are Germany, France, China, Italy, Portugal, the United States, and the United Kingdom.19
Relations with the United States
The United States and Spain have close links in many areas, including extensive cultural and economic ties. The two countries also have a history of partnership on diplomatic and security issues, including strong counterterrorism cooperation.20 Under the terms of a bilateral Agreement on Defense Cooperation originally signed in 1988 and subsequently amended several times, the United States has access to a naval base at Rota and an air base at Morón. According to the International Institute for Strategic Studies’ Military Balance 2026, approximately 3,700 U.S. military personnel were stationed in Spain as of early 2026.21 Since 2014, four U.S. Aegis ballistic missile defense (BMD)-capable ships (Arleigh Burke-class destroyers equipped with the Aegis BMD system) have been based at Rota as part of the European Phased Adaptive Approach for BMD in Europe. In 2023, the United States and Spain signed an agreement to increase the number of U.S. destroyers forward deployed in Rota from four to six. In 2024, a fifth destroyer arrived.22 The ships operate in the Mediterranean Sea to defend Europe against ballistic missiles that could be launched from countries such as Iran. The ships also have undertaken other missions, including patrolling the Black Sea, participating in interoperability drills in the Baltic Sea, and conducting anti-submarine exercises in the North Atlantic Ocean.
U.S.-Spain relations have experienced considerable tensions during the second Trump Administration. Prime Minister Sánchez has been one of the leading European critics of the Trump Administration’s foreign policy.23 The Sánchez government has opposed the U.S. military operation against Iran, arguing that Spain’s “position does not stem from any antipathy towards the American administration, and even less from sympathy for Iran’s brutal regime…. Our position stems from the fact that this war is illegal, a major threat to the rules-based international order, and contrary to the interests of humanity.”24 Spain denied the use of Rota and Morón to U.S. forces involved in strikes on Iran and closed Spanish airspace to flights involved in the operation.25 Spain’s government argued that using the bases for the Iran operation would violate the bilateral basing agreement; Foreign Minister José Manuel Albares reportedly stated that “Spanish military bases will not be used for anything that falls outside the agreement with the United States and the United Nations Charter.”26 President Trump has been critical of Spain’s policy responses, reportedly stating that the Sánchez government is “not cooperating at all, they have been very bad,” and that the United States could “cut off all trade with them.”27 Sánchez also opposed the U.S. operation to capture Nicolás Maduro in Venezuela, reportedly stating that “Spain did not recognize the Maduro regime. But neither will it recognize an intervention that violates international law and pushes the region toward a horizon of uncertainty and belligerence.”28
Defense spending has been another source of tension between the United States and Spain. At NATO’s June 2025 summit, all NATO members except Spain committed to spending 5% of GDP on defense by 2035 (3.5% on core defense requirements, such as equipment and personnel, and 1.5% on defense- and security-related spending, such as critical infrastructure, civil preparedness, and strengthening the defense industrial base). The Spanish government reportedly informed NATO prior to the summit that it could not commit to the 5% target and received an exemption allowing it to set a defense spending target of 2.1% of GDP (see “Defense Spending” section, below).29 President Trump criticized Spain’s position, reportedly stating “We had one laggard—Spain…. They have no excuse to do this…. Maybe you should throw them out of NATO, frankly.”30 In August 2025, the Spanish government announced it would not move ahead with purchasing U.S.-made F-35s (built by Lockheed Martin) to replace its aging fleet of F-18 aircraft, asserting that it would instead seek to acquire a European-made alternative.31
Economic Ties
U.S. exports of goods and services to Spain were valued at $38.6 billion in 2025, and U.S. imports of goods and services from Spain were valued at $35.8 billion.32 Top categories of U.S. goods exports to Spain are energy products, chemicals, transport equipment, and engines. Top categories of U.S. goods imports from Spain are industrial machinery and equipment, semi-manufactured goods and construction material, energy products, and food products.33 In 2024, U.S. direct investment in Spain totaled $33.8 billion and Spain’s direct investment in the United States totaled $87.4 billion.34 According to the U.S. Department of Commerce, leading sectors in Spain for U.S. exporters and investments are the aerospace and defense sector, business investment services, energy, green technologies, information and communication technology, medical equipment and devices, safety and security equipment and services, and the agricultural sector.35 In 2023 (most recent data available), U.S. affiliates employed nearly 195,000 people in Spain and Spanish affiliates accounted for 86,500 jobs in the United States.36 As Spain is a member of the EU, U.S. tariffs on products from the EU apply to products from Spain.37
Selected Foreign Policy and Security Issues
For decades, the main tenets of Spanish foreign policy have been multilateral cooperation through Spain’s membership in institutions such as NATO, the EU, and the United Nations; friendly and cooperative relations with the United States; and strong ties with Central and South America. Spain also views security and stability in the Maghreb, Mediterranean, and Middle East to be foreign policy priorities.38
Defense Spending
Spain increased its defense spending from approximately $12.6 billion in 2019 to approximately $37.9 billion in 2025.39 At an estimated 2% of the country’s GDP, the 2025 figure met the goal that NATO members agreed to in 2014 as a minimum defense spending target. The Sánchez government increased defense spending by approximately $12 billion in 2025 to reach 2% of GDP.40 Over the past decade, Spain has had one of the lowest defense spending percentages in the alliance. Much of the new spending is intended to strengthen Spain’s national defense industry; Spain launched more than 30 military equipment modernization programs in 2025.41 As discussed above, Spain is the only NATO member that has not committed to spending 5% of GDP on defense by 2035. The Sánchez government argued that allies’ inputs to NATO should be measured not solely by spending but also by military capabilities and contributions to NATO operations and initiatives; the government asserted that Spain is a strong contributor to NATO missions and that it already has increased defense spending considerably.42 Some analysts express doubt that Spain can meet its NATO capability requirements without further increases in defense spending.43Some observers suggest that Spain’s reluctance to spend more on defense is largely due to domestic political pressure to maintain or increase spending on social welfare programs.44
Russia’s War Against Ukraine
Spain has supported Ukraine following Russia’s 2022 invasion and backed the EU sanctions adopted against Russia to date. According to the Kiel Institute, a nongovernmental organization that tracks international assistance to Ukraine, Spain committed $1.64 billion in military assistance and $900 million in financial and humanitarian assistance to Ukraine from January 2022 through February 2026.45 Spain’s military assistance to Ukraine has included Leopard tanks, anti-aircraft missiles and systems, anti-tank weapons, small arms, and ammunition. As of December 31, 2025, Spain reported hosting more than 259,000 refugees from Ukraine.46
International Security Missions
Spain is an active participant in international security and peacekeeping operations, with approximately 4,000 soldiers and guardias civiles (one of Spain’s two national police forces) deployed in 15 international security and peacekeeping missions as of January 2026.47 Spain contributes military personnel to the NATO Enhanced Forward Presence battlegroups in Latvia, Romania, and Slovakia. Spanish aircraft and personnel also regularly participate in NATO air policing missions in the Baltic and Black Sea regions. In addition to its contributions to reinforcing NATO’s eastern flank, Spain contributes to NATO’s training mission in Iraq, NATO’s maritime security operation in the Mediterranean Sea, and NATO’s operation to protect Turkey’s border with Syria. In addition, Spain has deployments to the UN peacekeeping mission in Lebanon, the EU anti-piracy mission off the Horn of Africa, and several other EU missions. Spain participated in NATO-led missions in Afghanistan from 2002 until the withdrawal of allied forces in 2021.
Relations with Israel
The Spanish government condemned the October 7, 2023, Hamas attack on Israel. Tensions subsequently emerged between Israel and Spain after some Spanish government ministers criticized Israel’s military campaign in Gaza. In May 2024, Spain (along with Ireland and Norway) formally recognized a Palestinian state based on pre-1967 borders, which includes the West Bank and Gaza, and East Jerusalem as its capital.48 Prime Minister Sánchez reportedly described the move as “the only way of advancing toward what everyone recognizes as the only possible solution to achieve a peaceful future, one of a Palestinian state that lives side by side with the Israeli state in peace and security.”49 In response to Spain recognizing a Palestinian state, the Israeli government recalled its ambassador to Spain and accused the Spanish government of rewarding Hamas’s terrorism. In September 2025, Spain recalled its ambassador to Israel amid diplomatic tensions over Spain blocking the use of its ports and airspace for the transport of weapons to Israel; in March 2026, Spain announced that it had permanently withdrawn its ambassador to Israel in the context of further tensions over Spain’s opposition to Israeli and U.S. strikes on Iran.50
Relations with China
Over the past several years, the Sánchez government has made Spain’s relationship with the People’s Republic of China (PRC, or China) a foreign policy priority.51 Some observers assert that especially during the second Trump Administration, Spain has sought to deepen economic relations and technology cooperation with China and attract more PRC investment and tourism. Such observers argue that Spain’s more favorable position toward China is a strategy to diversify economic ties in the context of tensions with the Trump Administration over trade, tariffs, and other foreign policy issues.52 In April 2025, shortly after the Trump Administration announced tariffs on the EU and other countries, Sánchez visited China to conclude a series of trade and cooperation agreements.53 The two governments signed additional economic and cooperation agreements during a visit by King Felipe VI to China in November 2025. In April 2026, Prime Minister Sánchez made his fourth visit to China in four years.54
About the author: Derek E. Mix, Specialist in European Affairs
Source: This article was published by the Congressional Research Service (CRS).
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