The first round of discussions on the post-2027 Multiannual Financial Framework (MFF) and new own resources took place at the dinner between the European heads of state or government on Thursday 20 March.
The challenge for the next MFF will be to repay Next Generation EU (starting in 2028) while funding new and old policy priorities.
At this preliminary stage in the discussions, the solutions put forward by the Member States differ. At the end of the summit, for example, French President Emmanuel Macron said he was “in favour” of “a new joint loan”, while Germany and the Netherlands said they were opposed. According to the French head of state, it will be “impossible” to manage “the investment wall over the coming decade” and “the repayment of Covid loans” without this joint loan. Furthermore, according to Emmanuel Macron, the euro area remains “very, very under-indebted compared to the United States” and “does not make sufficient use of the financial leverage”.
While German Chancellor Olaf Scholz told a press conference that “there is not that much room for manoeuvre”, the President of the European Commission, Ursula von der Leyen, said that the issue of new own resources which has been “on the Council’s table since 2021”, needed to be “clarified”. Already on 6 March, at the extraordinary summit on defence and support for Ukraine, the French head of state supported the adoption of new own resources, including a digital tax (otherwise known as the ‘GAFA’ tax) (see EUROPE 13594/18).
Will the next EU budget be more ambitious or will it force Member States to make choices between political priorities? Positions are likely to be more fragmented than in the past, with the arrival of priorities relating to security, strategic autonomy and competitiveness.
There were the “frugal” and the “friends of cohesion”. The advocates of new own resources, or even a new common loan, are part of the equation, unlike the cohesion states, which are not necessarily in favour of new own resources.
The ‘frugal’ have decided that it will be a question of making choices. “If we want to be ready to take on new tasks, we have to be ready to cancel the old ones”, warned the Danish Prime Minister, Mette Frederiksen. In the same vein, the Belgian Prime Minister, Bart De Wever, called on the EU to “be careful with the debt”, while specifying that “at the end of the road, choices will have to be made”. According to him, “the budget challenge is enormous” and the negotiations will be “difficult”.
The European Commission’s proposal is expected in July (see EUROPE 13577/20). (Original version in French by Florent Servia)