Dutch to play budgetary hardball with the EU

9 December 2003

AMSTERDAM — Still reeling from its embarrassing defeat in the recent EU “battle of the budgets”, the Netherlands is playing hardball in its fight for guarantees that future European treaties and agreements will be strictly adhered to.

New Dutch Foreign Minister Ben Bot warned that if the Netherlands did not win such a promise during a meeting of EU leaders in Brussels this coming Friday and Saturday, it would take further action. The minister also said no course of action had been ruled out.

If necessary, the Netherlands is prepared to delay negotiations aimed at creating an EU Constitution until January. Bot said the Dutch message was slowly starting to gain weight in Europe and in Italy, which currently holds the rotating EU presidency.

The EU will resume discussions around the constitution this weekend. The constitution has been the subject of extended discussions already, particularly around EU defence policy, the role of foreign ministers, voting procedures, the extension of majority voting and references to God.

But Christian Democrat CDA Minister Bot refused to answer questions whether the Netherlands would allow the constitution discussions to fail if the Dutch did not get their own way. “You should never show your weapons too early,” he said. Bot took over from Jaap de Hoop Scheffer who stepped down as Foreign Minister to lead Nato at the beginning of December.

Bot was infuriated — as was Liberal VVD Finance Minister Gerrit Zalm — that Germany and France escaped fines in November for continued breaches of the EU Stability Pact which drawn up to maintain the stability of the euro and stave off high interest rates.

The Dutch government has been a strong advocate of the pact, which obliges the 12 eurozone states to restrict budget deficits to below 3 percent. Zalm demanded last month that billions of euros in fines being levied on the offending countries.

But he failed to gain majority support from the other EU member states. Instead, the EU sided with the German and French claim that the pact is too restrictive and essentially called for finance ministers to adapt budgets to prevailing economic conditions.

Adding insult to injury, new figures from the Dutch government’s own macroeconomic thinktank Central Planning Bureau (CPB) have indicated the Dutch budget deficit could hit 3.25 percent of Gross Domestic product (GDP) next year. But Zalm dismissed panic reactions and will re-examine the state finances in the Spring.

But the Lower House of Parliament, Tweede Kamer, has demanded harder guarantees in the EU constitution, a proposal that European Affairs State Secretary Atzo Nicolai launched in Naples last week. The proposal was greeted with cool reactions, but Nicolai said more and more countries — particularly the incoming EU member states — were siding with the Dutch.

Minister Bot also said he was still searching for backers and stressed he was not seeking vengeance for the budget battle defeat two weeks ago.

Meanwhile, the Netherlands will also suggest at the coming EU summit that it be made possible to lodge complaints in the European Appeals Court against countries which breach budgetary regulations. The Dutch will also investigate whether it is possible to make it more difficult to block fines for financial breaches.

The harder stance comes after Liberal VVD parliamentary leader Jozias van Aartsen demanded at the end of last month that the Netherlands take a tougher approach to negotiations over the looming constitution.

Subject: Dutch news