Deadlock as European leaders battle over budget

17th June 2005, Comments 0 comments

17 June 2005, BRUSSELS — Leaders of the European Union appeared no closer to breaking the deadlock over its budget with the row over the British rebate at the heart of the dispute.

17 June 2005

BRUSSELS — Leaders of the European Union appeared no closer to breaking the deadlock over its budget with the row over the British rebate at the heart of the dispute.

Britain says it will veto any cut in the EUR 4.4 billion rebate without a reform of farm subsidies - a condition France again rejected.

Sweden has suggested putting off any budget decision for a year.

Spain, meanwhile, was continuing to push for an extension of EU aid for up to five years, despite widespread opposition from the richest countries.

The Spanish prime minister Jose Luis Rodríguez Zapatero labelled the European Union's offer of financial aid over the next two years as "insufficient".

The president of the EU, Luxembourg prime minister Jean-Claude Juncker, said it was "improbable" that the EU would agree to Madrid's proposal to a slower phasing out of aid.

He proposed Madrid should, instead, receive EUR 2 billion of aid between 2007-8.

Zapatero said: "The latest proposal is better than the last but it is insufficient."

Madrid's demand for more aid comes despite the fact its average incomes are 90 percent above the EU average — the measure used to decide if a country should stop receiving monies from the EU Cohesion Fund.

Between 2000-06, Spain received EUR 48 billion of EU aid.

Over the past 19 years, since Spain joined the EU, aid has helped to build its economy into one of the fastest growing in Europe.  

Meanwhile, leaders of the 25 states put the EU constitution on hold by scrapping a 2006 deadline for ratification.

French and Dutch voters rejected the treaty in recent referendums.

Other states have postponed their referendums on the constitution, including Denmark, Ireland, the Czech Republic and Portugal.

Estonia bucked the trend by saying it would press ahead with ratification.

The leaders remain deadlocked on the budget issue, with Britain refusing to discuss any cut in its annual EUR 4.4bn without a fundamental review of farm subsidies.

But French President Jacques Chirac ruled out this possibility, saying the rebate should "under no circumstances be linked to a reform of farm expenditure".

Juncker was having bilateral meetings with French president Chirac and British prime minister Tony Blair.

Some countries are in favour of agriculture spending reform, but none support the British rebate remaining.

[Copyright EFE with Expatica]

Subject: Spanish news

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