John Palmer looks at the paradox that confronts the EU in 2006: despite difficulties, EU expansion is set to continue in 2006. By the end of the year, there will be 27 EU countries, and still more looking to join. With a revitalized economy, and with the EU presidency for the second half of the year, Germany will return to being a key European actor. Austria, EU presidency holders for the first half of 2006, will want to focus on the Lisbon agenda; transatlantic relations with the United States will remain unpredictable, because of instability in the US administration and a decline in US power. A weakened US may necessitate a stronger EU, with some additional forms of shared sovereignty being a critical part of this.