Important turning point in negotiations on EU's multiannual budget could become German presidency - MEP Ijabs

  • 2020-05-26
  • LETA/TBT Staff

RIGA - An important turning point in the negotiations on the European Union's (EU) multi-annual budget could be the German Presidency of the EU Council, MEP Ivars Ijabs (For Development) told LETA.

"The German presidency will certainly be used to move the debate on the EU's multiannual budget forward. It is hoped that the leaders of the member states will reach an agreement on the budget," Ijabs said.

However, he pointed out that what Latvia experienced last year is also possible in the EU, namely, if the budget is not adopted by the end of the year, then the previous year's budget will be continued, although it is much more difficult to implement this at the EU level. It should be noted that a number of programs will cease to operate on December 31 this year, he said.

"If these programs are not replaced by new ones, the money will simply stop circulating. So I would like to hope that the heads of governments will work hard on this, so that this framework is still in place," the politician said.

Ijabs stressed that the current situation in the EU remains complicated because it is not clear what role the Covid-19 crisis could play in the budget. In his view, this is certainly one of the key issues. He predicted that the negotiations on the multiannual budget would be difficult, but there was no reason to say that they will not succeed.

MEP Inese Vaidere (LETA) previously told LETA that EU member states should talk about increasing EU contributions to 2 percent of gross national income.

Ijabs pointed out that increasing contributions would be a sensible solution, as the overall needs of the countries have increased and the Covid-19 crisis is a good example of this.

"Countries that have traditionally been major contributors, such as Germany, the Netherlands and others, should understand that their prosperity depends to a large extent on their access to the EU's single market and the EU's single economic space," said the MEP.

According to him, these countries must then also play a part in maintaining the single economic space and managing crises. However, Ijabs pointed out that it was important to remember that the EU budget ceiling is fixed in EU treaties. This means that member states cannot simply be told that they will make greater contributions to the EU budget from next year. This is not possible, stressed the politician.

Ijabs emphasized that 2 percent at the EU level is a huge amount, from a seven-year perspective, it could be as much as a trillion euros. According to him, it is clear that the EU budget is the main instrument through which the EU works. That is why the resolution adopted by MEPs emphasizes that what is at stake in the Covid-19 crisis must be addressed through these common budgetary instruments, rather than trying to create new funds in which some countries can receive more money and others less.

"It is also in Latvia's interests to have a larger multi-annual EU budget. In the foreseeable future, for every euro we pay in, Latvia will get back 2.5 or even 3 euros from the EU," the MEP said.

However, if the countries do not reach an agreement by December 31, Latvia will receive funding for cohesion and direct payments on the level of the previous year's budget. As Ijabs emphasizes, this does not benefit Latvia, as direct payments are lower than foreseen in the new budget plan.

Asked what worries MEPs about the new multiannual budget framework, he pointed to differences of opinions between some member states, which are still wide enough.