4 December, 2023
The Romanian president Klaus Iohannis (left) and the president of the European Council Charles Michel before the first summit on the EU budget (photo: YouTube)

Bucharest prepares a compromise proposal together with two other countries from the group of „The Cohesion’s Friends”

Vladimir Mitev

This article was published on 9 March 2020 on the site of the Bulgarian newspaper “Word”.

Romania is going to play a more important role in the forthcoming negotiations on the European budget. The explanation probably is that it is geographically in the Eastern part of the EU, which makes it close to the countries from the Visegrad Group, it has cultural affinity with the countries in Southern Europe, excellent economic and political relations with Germany and France, and is home to major investments from the net donors of the EU such as Austria, Netherlands, Sweden and Denmark. The impeccable Romanian eu presidency could be added to these excellent cultural and economic relations, say Romanian experts who believe that the eu presidency has strengthened the image of the country as an honest broker.

Why is all that important in the discussions, which follow the multiannual financial framework (2021-2027)? The 27 member states didn’t manage to reach an agreement on the European budget on their first summit for 2020. No diplomacy and discussion unfold in the European game of thrones. On one hand stand the frugal states (the already mentioned net donors of the EU such as Austria, Netherlands, Sweden and Denmark). They want the member states’ contribution be reduced to 1% of GDP. On the other pole stands the so-called group of “Cohesion’s Friends” – 17 countries from the Eastern and Southern part of the EU, who fight for “an ambitious Europe”, which could have higher expenditures. Somewhere in the middle stand France and Germany, which wait to see how things will unfold. The European parliament wants a country’s contribution of 1,3% of GDP . The European Commission proposes 1,11% of GDP. The European Council proposes 1,07%.

In this context the Friends of Cohesions reached an agreement on 21 February, when the European summit was over, that three countries would prepare the counterproposal to the project for European budget, presented by the group of the frugal countries. The three countries which will be the leaders of the poor and needy of cohesion funds would be Italy, Portugal and Romania.

Within the summit the Romanian president Klaus Iohannis said that there should be no reductions of the funds for countries, such as Romania in two domains – the cohesion funds and the agricultural subsidies. These are the so-called old domains of funding. Romania just as Bulgaria has old infrastructure and relies on European funds for its modernisation. In the same time the net donors of the EU want to fund spheres such as digitalisation and climatic changes. In this context the Friends of Cohesion – the periphery of the European nucleus, resist and fight for their interests.

The Friends of Cohesion have already had a few meetings and have come out with the categorical positions, which sustains that the EU is a chance for development and not just a destination for budget expenditures as the rich countries think.

This is also Iohannis’ position, who repeats in Bruxelles and before the European summit that he fights for an ambitious Europe. In his view the overall volume of the European budget must be determined at a sufficiently high level, so that it would allow that the political goals from the Sibiu Summit in 2019 be accomplished. He reminds that they are part of the strategic agenda of the EU. He asked for a balanced approach, so that the specific interests of the member states and of the EU as a whole be in peace, because that is how the plans will be realised.

Klaus Iohannis underscored the need for cohesion policies and for common agricultural politics, which in his view plays a key role for the development of all the EU. He is convinced that these two policies contribute also to the two “new” domains of funding: digitalisation and fight against climatic changes. Iohannis insists that the level of cofunding from the current financial program must be preserved and the funds for development of the rural regions should be increased.

The behaviour of Iohannis on the international scene and the one of the guiding force from the foreign ministry – Bogdan Aurescu, should be carefully observed, because Romania could contribute to the Friends of Cohesion, where Bulgaria stands too. Romania is in a government crisis. It has not government with complete rights. In these conditions the role of Iohannis grows. But he has also the advantage that he goes to these summits for a sixth consecutive year and is one of the EU leaders with experience. The Bulgarian prime minister has participated in these summits for a longer time, but unlike the English-speaking and German-speaking Iohannis, Borisov doesn’t speak foreign languages. So the Romanian president has chances to have greater flexibility in the bilateral and multilateral negotiations.

It is still early to evaluate what counterproposal would Italy, Portugal and Romania prepare so that compromise is reached. The comments in Romanian media as far as they exist, underscore the fact that the serious question is not what sum would be allocated to Romania, but what the government would do with it. The RFI author Mihaela Ghergisan says that the direct subventions for Romanian farmers should grow by 0,4% as the EC outlines. But Romania has never had a national agricultural development plan. This is a condition for the acquisition of funds after 2021, remains Gherghisan. Also, when the discussion is about the funds for transfer from coal to green energy resources, Romania doesn’t have a plan for ecological restructuring. In other words, it should think not so much on the resolution of European problems, as on writing its own homework.

The role of Iohannis however is to answer for the strategic issues and to be the European figure of his country, as he represents it in international relations. .He is not expected to supervise or to do difficult bureaucratic work. That is why he will probably do what is expected from him – to coordinate the preparation and the realisation of a compromise decision for the European buget.

Probably this is one of the motives for the lack of reaction and comments in Romania about the European budget is the technical complexity of the discussions. How many journalists in this part of the world know notions such as “budgetary instruments for competition and convergence”, “instrument for convergence and reform” and “Just Transition Fund” . The debates on the European budget go in parallel to the definition of the eurozone as a community with its own financial mechanisms. A big part of the “friends of cohesion” are part of the eurozone, while Romania seems to be chosen because there must be a pillar in the group, which represents the interests of the members outside the eurozone.

Bulgarians and Romanian could win, if there is someone to explain in simple words what is the meaning of the financial instruments which the friends of cohesions want to use for development. Without in-depth knowledge of the discussions issues both countries will remain isolated and isolated from participation. As far as the European budget is concerned the Romanian diplomacy adopts a more active role. It remains to be seen to what extent the coordination between the Friends of Cohesion inside the eurozone and those outside it would bring to the formulation of a compromise solution for the European budget. Even the fact the Bucharest assumes such a role means that it has confidence and European ambition.

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