Tony Blair arrives in Tallinn on Dec. 1 with a hard bargain. When The Baltic Times went to press, details were still murky, but according to most reports, the U.K. prime minister will try to convince his Baltic colleagues that they should be prepared to sacrifice part of the structural and cohesion funds they had planned to absorb over the next seven years. How much exactly is unclear, but it could be as much as 10 percent, which would translate into several hundred million euros from 2007 's 2013.
Blair, who will travel to other East European countries after his stop in Estonia, is trying to salvage the EU budget, which collapsed in June due to a Franco-British standoff. French leadership is refusing to give up subsidies for its farmers, while Britain doesn't want to give up its so-called rebate, granted in the 1980s to compensate for the lack of funds the country receives from the Common Agricultural Policy. Blair said the U.K. was willing to say goodbye to the rebate if France is prepared to reform CAP, which soaks up some 45 percent of the EU budget. Worse, he repeats, 70 percent of CAP subsidies go to 20 percent of the union's farmers. EU agricultural policy must be reformed, he insists.
If we look at the broader picture, Blair is trying to salvage the European Union. If leaders fail to find a compromise at their summit this month, there's no telling when they will. Perhaps the next presidency, which begins in January, will be able to, but this is unlikely. The essential conflict 's rebate vs. agricultural reform 's will still be there, and Blair and Jacques Chirac will still be in office.
Baltic and other East European leaders made it clear before Blair's visit that they would not accept any cuts in structural funds. In a letter to the prime minister, the leaders of the four Visegrad countries wrote, "We expect that a new budget should strengthen economic growth and employment, boost competitiveness and support structural reforms in member countries… Without an agreement in December, the response to these challenges together with the ambition of new EU members to catch up would be delayed and confidence in the capability of the enlarged EU to find agreement might be seriously undermined."
Baltic leaders have echoed this sentiment: all the talk of union cohesion means nothing if EU leaders can't put their money where their mouth is. You promised, so you should be ready to deliver.
This could be a reckless stance. Indeed, the Baltic states joined the union with the aim to absorb structural funds and catch up with Western Europe as quickly as possible, or roughly within a generation. However, they would be wise to remember that some funds are better than no funds at all. And while their choice isn't that start 's not yet, anyway 's Baltic leaders should keep in mind the larger goals: the EU economy, the Lisbon agenda, global competitiveness. The union economy is struggling right now, and all members should be prepared to make sacrifices. New members included.
