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Hungary Crafts "Budapest Compromise" Solution to EU Budget

by soj Thu Jun 30th, 2005 at 08:34:30 AM EST

Two weeks ago, the European Union failed to agree on a budget.  Now it looks like some of the newest members have come up with a solution.


Irritated by what they felt was Britain's "wrecking" of the budget talks, Hungary has tabled an agreement called the "Budapest Compromise" and Poland, Czech Republic and Slovakia all seem to be on board:

[Hungarian Foreign Minister Ferenc] Somogyi proposes that, if no agreement is be reached during the British presidency of the EU, which runs from July 1 to the end of the year, a temporary threeyear budget should be worked out under the Austrian presidency which will follow the British.

The Budapest Compromise was necessary because the budgetary disagreements resulted from "genuine differences in principle" between the member states.

The EU would function even without a budget after 2007, but structural funds would be paid to member states according to the previous five-year budget, which was agreed upon before the new members joined. They would thus receive far less.

"It will be difficult to reach a compromise on the budget during the British presidency," Katinka Barysch, chief economist at the Center for European Reform, a London-based thinktank, told The Budapest Sun.

"To broker a compromise you have to be seen as above the arguments, and the UK is widely seen as negotiating for its own national interest."

Whilst it was welcome that the new member states were seeking to contribute to finding a way through, she thought that panic was premature. "The EU budget is rarely agreed upon before spring of the year before it comes into force, so we could easily wait until spring 2006," she said - long after the British presidency.

Looks like "New Europe" is tired of "Old" Europe's constant bickering and want a budget to be passed, and they're willing to outwait the British to do it.

Pax

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Hmm, this is an interesting development...and from the new members too. That suggests to me that the situation is much more dynamic that many have stated so far.

"Once in awhile we get shown the light, in the strangest of places, if we look at it right" - Hunter/Garcia
by whataboutbob on Thu Jun 30th, 2005 at 08:39:39 AM EST
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"It will be difficult to reach a compromise on the budget during the British presidency," Katinka Barysch, chief economist at the Center for European Reform, a London-based think tank, told The Budapest Sun.

"To broker a compromise you have to be seen as above the arguments, and the UK is widely seen as negotiating for its own national interest."

My Analysis: EU Returns to Normalcy
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I'm glad the old lines of nationalism are seen again. The 'non' voters wanted recognition of their identity within the EU, their leaders are listening.

  • Blair doesn't want to show his weakness relative to Margareth Thatcher who got the preferential treatment in 1984
  • Chirac got whipped last two elections by French voters, latest "non" hurt a lot
  • Schreuder is indeed a lame duck heading into Fall elections after losing all major regional elections
  • Dutch Balkenende got hit hard with "nee" by voters who need to understand direction and goal of further expansion: Bulgaria, Romania and Turkey and bad feelings on EU 3% deficit rule violations by France, Italy, Greece and Germany
  • EU agenda at talks was not wise - definite decision on budget can still wait till next year
  • EU Charter and so called constitution needs to be ratified by another dozen countries before evaluation in 2006
  • Daily EU policy will not change, is very well established in Brussel and Strasbourg
  • Player change is needed in the major countries before further advance will be possible
  • Blair returns to the British Isles, has enough separation in place so no referendum is called for
  • Berlusconi? Is looking forward to return to his business enterprise, play boyish behavior and visiting the games of AC Milan
  • Atlantic Ocean hits the coast of Europe at Normandy according to De Gaulle and successors

The French always had great difficulty to allow the Brits to become EU member. The Dutch gave great support, and apparently money funding the EU to compensate for payment to Margareth Thatcher.

The Dutch Ruud Lubbers had a ugly bitter fight with Germany's Kohl over the speed to unite East and West Germany in 1990, the economic cost involved and fear of economic backlash.  

Most EU decisions are politically motivated and paid for by poor economic policy. Decision is always moved forward, shows lack of unison, courage and long term commitment. See the position of the British throughout EU discussions - "If Europe adapts sufficiently to our vision, our commitment will grow".

USA WELCOME: Make Yourself Known @BooMan Tribune and add some cheers!

by Oui on Thu Jun 30th, 2005 at 09:14:21 AM EST
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Telling, that this week the announcement came on internship of Euan Blair at US Congress Rules Committee under Republican leadership.

UK to push for deal on EU budget

Foreign Secretary Jack Straw says drawing up a "rational budget" will be a key part of the UK agenda as it takes over the presidency of the EU.

Agenda of Britain's EU presidency --

  • Europe's sugar regime to be discussed at WTO meeting in December, part of reform of the Common Agricultural Policy
  • UK's rebate would be addressed as it was based on a second "anomaly" to agricultural subsidy by EU
  • resolve working time directive
  • reduction of the volume and complexity of EU legislation
  • British government strongly committed to Turkey membership
  • pursue EU key foreign policies on the Middle East, Iran and support for Iraq
  • EU's aid commitment to Africa
  • progress on climate change

"The UK takes over the rotating presidency of the European Union on the 1st of July for six months. When a country holds the presidency, it is expected to be neutral. The UK has made it clear it intends to push the controversial argument that the European Union budget needs fundamental reform.

France has insisted the agreement which fixes farm payments until 2013, should not be changed. "

Personally, I see no advancement of EU policy during Tony Blair's term of presidency. Blair on his foreign policy has become a broken 78 rpm vinyl record: Mid-East peace to be attained in a trade-off with the Iraq invasion as a step forward. Same with policy failures in Aid to Africa, climate change, and Commonwealth policy on Mugabe and Zimbabwe.

USA WELCOME: Make Yourself Known @BooMan Tribune and add some cheers!

by Oui on Thu Jun 30th, 2005 at 10:05:49 AM EST

"To broker a compromise you have to be seen as above the arguments, and the UK is widely seen as negotiating for its own national interest."

Yep, central Europe is reality-based...

In the long run, we're all dead. John Maynard Keynes

by Jerome a Paris (etg@eurotrib.com) on Thu Jun 30th, 2005 at 10:31:06 AM EST
It seems slowly but surely my government realises its own interests aren't with Bliar. (A good change from two years ago when my PM initiated that letter of fealthy to Bliar from a number of EU members and member candidates.)

Recall what happened when Poland and Spain blocked the acceptance of the EU constitution in the European Council, trying to keep their advantages granted in the Nice treaty. At the time Poland hoped it could act as a leader of an Eastern Block, but in the end was left alone, as the others realised it's not France and Germany that acts selfish here. (A similar thing happened on a smaller scale in the last summit before the EU approved the 10-state extension, when Poland was too selfish about agrarian subidies - the others realised this won't help them and accepted the compromise.)

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Fri Jul 1st, 2005 at 06:39:10 AM EST
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