Thu. Jun 13th, 2024

EU in desperate need for more money as bloc warned it ‘will die’ despite trillions budget

Alex Thompson By Alex Thompson Jun5,2024

The European Union may need a larger budget as it faces growing demands in defence, climate change, and potential expansion to Ukraine. The worrying news for the Brussels bloc comes amid discussions on how to structure the EU’s budget for the upcoming seven-year period ending in 2034.

Currently, the EU’s budget sits at just over €1 trillion, but the European Commission is expected to propose its plans for the next seven years in June 2025. EU Budget Commissioner Johannes Hahn, speaking at a conference in Brussels, emphasised the need for a budget that aligns with the EU’s broader ambitions.

“There should be a budget matching our ambition for a stronger, more competitive, and secure Europe,” Hahn said.

He also urged EU leaders to move away from the notion that the budget cannot exceed 1 percent of the bloc’s Gross National Income (GNI).

“Once we are clear and agree on our common priorities, we need to have sufficient funds to cater for common needs,” Hahn added.

The current rules limit the EU’s central budget to about €170 billion per year, with nearly a third of it spent on farm subsidies and the Common Agricultural Policy. However, with EU members boosting defence spending due to the war in Ukraine, and potential costs for Ukraine‘s accession to the EU, financial pressure is mounting.

A report from the think tank Bruegel estimated that Ukraine‘s membership could cost the EU budget around €136 billion over the next seven years.

The EU agreed to its “biggest stimulus package in our Union’s history” during the pandemic, but there’s uncertainty about how to repay the common EU borrowing generated by the Next Generation EU programme. Efforts to generate new EU revenue through company profits or green levies have stalled, largely due to tax policies being under national jurisdiction. This could mean future demands on EU funds will fall on member states.

Despite these challenges, Hahn proposed measures to streamline the EU budget and ensure its focus on common priorities.

Belgian Foreign Minister Hadja Lahbib stressed the importance of a budget that reinforces the core values of the EU, mentioning the successes in promoting democracy, rights, and the rule of law. This reflects recent controversies in countries like Poland and Hungary, where the EU had withheld funds due to concerns over democratic backsliding and judicial independence.

The EU budget remains a topic of significant debate, with national leaders keen to shape its direction. Croatian premier Andrej Plenković, considered a potential contender for the EU Commission presidency, supports a more ambitious budget. “We should explore the possibility of having a more ambitious budget,” Plenković said.

Portuguese Foreign Minister Paulo Rangel took a more direct approach, warning: “If you don’t increase it, the EU will die.”

Alex Thompson

By Alex Thompson

Alex is an award-winning journalist with a passion for investigative reporting. With over 15 years of experience in the field, Alex has covered a wide range of topics from politics to entertainment. Known for in-depth research and compelling storytelling, Alex's work has been featured in major news outlets around the world.

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2 thoughts on “EU in desperate need for more money as bloc warned it ‘will die’ despite trillions budget”
  1. As a passionate supporter of the European Union, I truly believe that investing in a larger budget is crucial for the bloc’s survival and growth. With increasing challenges in defense, climate change, and the potential expansion to Ukraine, it is clear that a stronger, more competitive, and secure Europe requires adequate financial resources. It’s time for EU leaders to prioritize common needs over budget limits and work towards a prosperous future for all member states.

  2. Will increasing the EU budget really solve the financial challenges the bloc is facing, especially given the current economic uncertainties?

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