Schroeder pleads for EUunity as budget hopes fade

16th June 2005, Comments 0 comments

16 June 2005, BERLIN - European Union leaders on Friday were making a last- ditch bid to clinch a multi-billion euro budget for the 25-nation bloc despite Franco-British wrangles over the share-out of EU aid.

16 June 2005

BERLIN - European Union leaders on Friday were making a last- ditch bid to clinch a multi-billion euro budget for the 25-nation bloc despite Franco-British wrangles over the share-out of EU aid.

Diplomats said Luxembourg Prime Minister Jean-Claude Juncker, who currently holds the bloc's presidency, was holding one-to-one meetings with the leaders of France, Germany, Britain and the Netherlands to try and win concessions needed to unlock a solution.

Juncker's bilateral discussions focused on Britain's budgetary rebate, Dutch demands for slashing its contribution to the EU budget and the inclusion of Romania and Bulgaria in the current farm spending package, thereby reducing subsidies paid to French farmers.

A so-called 'revision clause' which would allow leaders to strike an interim deal now and then adapt it end-2008 to changed political and economic conditions could provide a way out of the current deadlock, diplomats said.

Talks were proving difficult, however. Czech Prime Minister Jiri Paroubek put the chances of a deal at "50-50."

His foreign minister Cyril Svoboda said he was "not very optimistic" and that if leaders failed to clinch a deal they could continue under the British EU presidency starting 1 July.

British Prime Minister Tony Blair has so refused to sacrifice a hard-won budget rebate which brings his country EUR 4.6 billion a year, while French President Jacques Chirac says his almost EUR 10 billion annual farm subsidy is sacrosanct.

Rich nations which bankroll the EU were also on the warpath. Swedish Prime Minister Goran Persson bluntly said the proposed EUR 875 billion budget for the period 2007-2013 was too big and his country was paying too much.

"I'm still very pessimistic," Persson told reporters, adding that it would be better to take an extra year to hammer out a better deal on the EU budget which does not have to enter into force until 2007.

Many leaders want a more up-to-date spending plan.

Denmark's Prime Minister Anders Fogh Rasmussen said the whole EU budget had to be revamped for the 21st century with more funds for innovation, research and development and education.

This view was countered by German Chancellor Gerhard Schroeder who told reporters it was vital the EU send out a signal of unity after the stinging defeat of the bloc's constitution by French and Dutch voters.

Pleading for compromise, European Commission President Jose Manuel Barosso said a less-than-perfect deal would be better than no agreement.

"It would be a serious error to postpone an agreement," he said, adding the EU's international credibility was also at stake.

Blair says he will only agree to review his country's budget rebate if France gives in on revamping and reducing farm subsidies.

But Chirac has upped the ante by telling the summit a freeze in the British rebate suggested by the Luxembourg EU presidency was not enough. The refund must be phased out and ultimately eliminated, he said.

Leaders on Thursday agreed to scrap a November 2006 deadline for winning final ratification of the bloc's constitution in response to the French and Dutch 'no' votes three weeks ago.

Luxembourg's Prime Minister Jean-Claude Juncker said the target date was now moved back to 2007.

DPA

Subject: German news

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