Germany and Spain clash over size of EU budget — Politico Europe
In Dublin, Ireland, Politico Europe reported on differences between Germany and Spain over the size of the next seven-year EU budget, which could amount to around €2 trillion. Spanish Economy Minister Carlos Cuerpo called for an increase in the common budget in an op-ed, while the leaders of Germany, Denmark, the Netherlands, Austria and Finland opposed this approach.
Spain's proposals
Cuerpo proposes setting the next multiannual budget at 2% of the EU's gross national income. According to him, this would meet the needs of supporting the economy and social cohesion.
The minister also proposed rescheduling the repayment timetable for the joint debt raised by the EU in 2021 to overcome the economic consequences of the COVID-19 pandemic. About €300 billion is to be repaid in 2028–2058, while the current plan provides for payments of around €25 billion per year during the next budget cycle.
In Cuerpo's view, postponing payments on the debt principal could free up an additional €11 billion annually for agriculture, defence and boosting competitiveness. Interest payments on this debt cannot be changed. According to the publication, the idea is supported by the European Commission, as well as Italy, France, Portugal and Poland.
More current news is available on the UA.News Telegram channel Telegram.
Objections from Germany and its allies
German Chancellor Friedrich Merz, as well as the leaders of Denmark Mette Frederiksen, the Netherlands' Rob Jetten, Austria's Christian Stocker and Finland's Petteri Orpo, rejected both the budget increase and the postponement of debt payments. Their countries contribute around 40% of the total EU budget.
In a joint article, they stated that it is impossible to add new priorities to old ones and shift the costs onto taxpayers. In their assessment, post-pandemic spending has already burdened the next multiannual financial framework by nearly €170 billion, while postponing repayment of the debt principal would yield only minor savings.
Ireland, which holds the presidency of the Council of the EU and is conducting negotiations, is to submit the next negotiating document in October. Germany and its allies are calling for spending in it to be cut by hundreds of billions of euros. Governments seek to reach an agreement by the end of the year, as elections in France, Italy, Spain and Poland next year could complicate negotiations and delay payments to farmers and researchers.
