France says it wants to say 'yes' to EU budget

12th December 2005, Comments 0 comments

BRUSSELS, Dec 12 (AFP) - France reiterated Monday that a cut in Britain's long-cherished EU rebate is crucial for an overall budget deal this week, calling for London's cheque to be slashed by 15 billion euros.

BRUSSELS, Dec 12 (AFP) - France reiterated Monday that a cut in Britain's long-cherished EU rebate is crucial for an overall budget deal this week, calling for London's cheque to be slashed by 15 billion euros.

"France is not here to say 'no' to an agreement, France is there to say 'yes,' but it must be a balanced agreement," said French Foreign Minister Philippe Douste-Blazy, in the sidelines of talks with his EU counterparts.

The 25-nation bloc is battling to agree its 2007-2013 budget plans at a crunch summit starting Thursday.

"The key is a lasting reform of the British rebate," Douste-Blazy told reporters, adding that it should be cut by "EUR 15 billion," and calling on Britain to pay its fair share of the EU's funding.

British Foreign Secretary Jack Straw, meanwhile, cast doubt on Monday over Europe's chances of ending a row over its long-term budget, warning there was little room for manoeuvre to clinch a deal.

Setting the tone for brinkmanship likely to be tested to the limit at a crunch summit this week, Straw even suggested the British EU presidency might not make any changes to a proposal already flatly rejected last week.

"These are difficult negotiations. The margin for manoeuvre is narrow. All of us would prefer agreement to no agreement but there cannot be agreement at any price," he said, arriving to chair a meeting of EU foreign ministers.

An agreement is blocked notably by Britain's refusal to surrender its multi-billion euro budget rebate, while France opposes reforming the EU's farm aid system, of which it is the major beneficiary.

Between 1997 and 2003 Britain's rebate averaged EUR 4.6 billion a year. Under British proposals last week it would run at around EUR 7 billion a year during the 2007-13 financial period.

Straw said the British EU presidency had listened to the reactions to its first budget proposals -- which were largely rejected -- and he left open the question of whether another offer would be made.

"At the moment we are listening very careful to the representations that are being made to us about the proposals that we issued last week," Straw said. "We are thinking about revisions to those proposals, and those revisions -- if there are any -- will be made available during the course of this week."

The 2007-2013 budget is worth more than EUR 800 billion and is vital for ensuring the transfer of much-needed funds to the EU's relatively poor new member countries in central and eastern Europe.

An attempt to agree the budget at a June EU summit collapsed amid acrimony, and the bloc's leaders meet again on Thursday with two essential issues yet to be resolved.

Britain refuses to surrender its multi-billion euro budget rebate, while France opposes reforming the EU's farm subsidy system, of which it is the major beneficiary as the Union's biggest agricultural producer.

Straw said movement on the rebate, in place since 1985, was unlikely.

"That stands and will stand unless there are fundamental changes to the reason for the rebate, namely the distortions of the common agricultural policy," he said.

In an effort to force movement in the talks, Britain's first proposal was to cut the budget to 1.03 percent of gross national income, from the June offer of 1.06 percent, which would have seen funds to the new members trimmed.

But given the criticism of that offer, Prime Minister Tony Blair's government has turned back to the farm subsidy system -- the common agricultural policy (CAP) -- as it consumes 40 percent of the budget.

Blair wants a guarantee that EU members will review the budget in 2008, in the hope of forcing CAP reform back onto the agenda.

France has led the attack on the rebate and kept up the pressure.

German Foreign Minister Frank-Walter Steinmeier said he expected new British proposals to be put on the table on Wednesday taking into account past criticism.

Stressing the urgency of striking a deal, he said: "For us, there are many good reasons to reach a deal in December and the talks I've had on the sidelines here have indicated that we're not the only ones to see it that way".

Other ministers were cautious about whether a deal would be possible.

"I don't know if we'll get much into the financial perspectives," said Luxembourg Foreign Minister Jean Asselborn, whose country was unable to foster an accord in June, as he arrived at the meeting.

Dutch Foreign Minister Ben Bot, who wants the contributions of the Dutch cut next time, said: "I'm very optimistic but we have to wait for the proposals, which are only coming on Tuesday or Wednesday so today I think we will make little progress."

Copyright AFP

Subject: French news

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