The Transformation of Europe: Future challenges of the Union and the States Although deeper than many before, the current crisis may be seen as just another cycle of capitalism. The author believes, however, that its roots are deeper and very much related to the challenges the world and Europe are facing at the beginning of the millennium. The response to the crisis should be coherent to the addressing the long term challenges. The crisis is accelerating the wheel of history and after the world will be different in many ways. It took many great visions, many years and a lot of political effort to make the European Union what it is today. We have a good institutional toolbox in place. We will need every piece of this toolbox and also allow it to funcion, if we want the #1 economy in the world to prosper in the future and have a say in how the world will be reshaped at the beginning of the third millennium.