The European Commission will kickstart two years of tense negotiations when it unveils its proposal Wednesday for the EU's long-term budget including funding reforms that risk renewed confrontation with farmers.
EU chief Ursula von der Leyen has to balance a growing list of priorities including bolstering the bloc's security, ramping up Europe's competitiveness to keep up with US and Chinese companies, countering climate change and paying debts due from 2028.
And all of this against a backdrop of soaring trade tensions with the European Union's biggest commercial partner, the United States.
The previous 2021-2027 budget was worth around 1.2 trillion euros ($1.4 trillion) and made up from national contributions -- around one percent of the member states' gross national income -- and money collected by the EU such as customs duties. One of the biggest challenges ahead will be over the size of the budget, as the EU's biggest -- and richest -- countries want to avoid paying more.
But unlike in the previous budget, the EU has debts due from the Covid pandemic, when the bloc teamed up to borrow 800 billion euros to support the continent's economy. These are estimated to cost 25-30 billion euros a year from 2028.
The European Parliament has made it clear that an increase will be
necessary.
"We believe that the union cannot do more with the same amount or less. So we believe that in the end, an increase of the budget will be unavoidable," said Siegfried Muresan, the EU lawmaker who will lead negotiations on behalf of parliament.
The commission plans to propose new ways of raising money including taxes on large companies in Europe with annual net turnover of more than 50 million euros, according to a draft document seen by AFP.
