European Commission president Jean-Claude Juncker is expected to call on the EU to look beyond its borders and negotiate trade deals with overseas partners in his annual State of the Union speech this morning.

The EU completed a free trade agreement with Vietnam in 2015,  is in talks to conclude a similar deal with the Mercosur trading bloc and is expected to make similar moves towards Australia and New Zealand. 

Mr Juncker will likely call on member states to start thinking of life after Brexit and exploit the window of opportunity provided by the US's inward-looking turn under Donald Trump. 

With the UK paralysed and the US caught in the equivalent of a political twilight zone, Juncker may calculate that Europe must seize the moment, parrying China's inroads into Europe (see below) while projecting eastward towards countries feeling queasy about their future relationship with Washington (Japan) or London (Australia, New Zealand).

READ: What Juncker said during last year's State of the Union address

The yearly speech is an opportunity for the Commission president to explain his views on the European Union and lay out his priorities for the year ahead. It will begin at 9am with an introduction by European Parliament president Antonio Tajani. 

Mr Juncker has dropped heavy-handed hints that he favours an as-yet unrevealed "sixth scenario.

Mr Juncker will follow, and after that MEPs will pose questions to the Commission president. 

It will be Mr Juncker's last real chance to lay out his policy agenda for the European Union. The Luxembourg politician is due to bow out of Brussels shortly after the UK exits the EU in spring 2019, meaning next year's State of the Union address will be less policy-focused and more concerned with summing up Mr Juncker's legacy. 

Future of Europe

Mr Juncker will likely use the occasion today to push forward the 'Future of Europe' debate he kick-started last March, when the Commission presented a white paper outlining five different paths the EU could take over the next 15 years.  

Those scenarios ranged from continuing without making any major changes to working towards closer integration of the 28 - and soon to be 27 - member bloc.  

Mr Juncker has dropped heavy-handed hints that he favours an as-yet unrevealed "sixth scenario," and the European Commission president may expound on this vision in his speech to the European Parliament. 

Mr Juncker will address European parliamentarians. Photo: Shutterstock

Cause for optimism?

Last year, Mr Juncker gave his speech with the prospect of Brexit weighing heavy over the EU. 

Twelve months later, that cloud is still there, and the EU continues to be beset by a variety of problems. 

Poland has grown increasingly intransigent, Catalonia is making secessionist noises and the election of Donald Trump as US president has complicated EU relations with its transatlantic ally. 

But despite all that, there is more cause for optimism in Brussels.       

Member state economies - even Greece's - are growing, and populist-driven far-right movements have been beaten back in Austria, the Netherlands and France, with Germany expected to join that list.

Progress on Brexit remains elusive, but Brussels' message that it is the UK which stands to lose the most from the divorce seems to have trickled down to many European capitals.

Jean-Claude Juncker. Photo: Reuters

A Eurobarometer survey published last month will have added a further spring to Juncker's step. The survey of all 28 member states found that EU citizens are increasingly trusting and optimistic about the EU, the continent's economic recovery and their own

China push back

The Financial Times said Juncker would use the speech to push back against Chinese trade, announcing measures to vet foreign takeover bids in sensitive sectors. 

China's investments in the EU have increased exponentially in the past five years: Chinese firms splashed out $70 billion on European companies in the first six months of 2016 alone.

More than the amount, though, it is the nature of Chinese investment which has Germany worried. Once a fixture in the real estate sector, China's presence is now increasingly focused on high-tech industries such as robotics and artificial intelligence.

Meanwhile, EU attempts to make inroads in China have faltered, and there is a growing sense in Berlin that Europe's open approach towards trade has made it ripe for the picking by a wilier, more strategic China.

Germany is backed by France in this respect, with the Elysees having explicitly said China is not playing by the rules. France is irked by China dumping steel in Europe, wreaking havoc on the European steel sector.

Watch the event live using our live stream. Broadcasting will begin at around 9am