Vienna secret meeting: Rich EU states forge budget strategy!

Vienna secret meeting: Rich EU states forge budget strategy!

An important pact is currently being worked on in Vienna that could shape the future financial foundation of the European Union. Senior representatives of the wealthiest EU states have gathered for a secret meeting to hammer out positions for upcoming negotiations on the next multiannual financial framework (MFF). The budget volume that is on the table for the period from 2028 to 2034 amounts to an impressive 1.816 trillion euros. The Tichys Insight reports that these negotiations are of historical importance because a lot of money and numerous questions about the future are at stake.

Major net contributors such as Germany, France, Sweden and the Netherlands have come together to develop a strategy to counter the demands of poorer EU nations. They demand higher spending, especially for agricultural subsidies and structural aid. In recent years, clear fronts have emerged between the net contributors and the recipients during the budget rounds. Germany and France are often in crucial negotiating positions, but this year there has been some disagreement within the camps: France has spoken out in favor of higher agricultural subsidies and the possibility of EU debt, while the Netherlands has taken a clear position against it.

Competition between member states

Poland and Hungary in particular have traditionally taken a leadership role in the Cohesion Alliance, but the political situation, characterized by the measures taken by Prime Minister Viktor Orbán, has weakened this dynamic. At the same time, Mediterranean states such as Italy and Spain are gaining increasing influence within the alliance. These shifts could have far-reaching consequences for the negotiations that are to be expected. A compromise solution is considered likely, but the tensions are noticeable.

The European Commission, for its part, has presented an ambitious draft budget that includes almost 2,000 billion euros, as can be read on the official website of the EU Representation. This proposal aims to protect citizens, strengthen the social model and promote industry. The budget is divided into four central spending categories:

• Wirtschaftlicher, sozialer und territorialer Zusammenhalt: 1 Billion Euro
• Wettbewerbsfähigkeit, Wohlstand und Sicherheit: 589,6 Milliarden Euro
• Europa in der Welt: 200 Milliarden Euro
• Verwaltung: 6 % des MFR

Particular attention is paid to budget flexibility. The number of EU financing programs is to be drastically reduced from 52 to 16 and the regulations are to be harmonized. There are also national and regional partnership plans that aim to use EU funds in a targeted manner. Investments are also being made in education, culture and democratic values, for example through an expanded Erasmus+ program.

An outlook on the upcoming negotiations

In addition, the core aim of the new MFF is to provide funds to support Ukraine, with up to 100 billion euros in the period from 2028 to 2034. The planned crisis mechanism also provides for up to 400 billion euros for loans to member states, while the budget for defense and security will be increased by 131 billion euros. These measures are intended to strengthen the European Defense Union.

The negotiations that lie ahead will not only revolve around the billions for regions, agriculture and research, but will also concern the future direction of Europe. It is clear that we have to be prepared for tough and emotional discussions. Nevertheless, it remains to be hoped that the states will manage to come to an agreement in order to jointly overcome the financial challenges of the coming years.