EU leaders resume ‘grumpy’ summit on budget, virus fund

BRUSSELS (AP) – European Union (EU) leaders were hunting for compromises yesterday as a summit to reach a deal on an unprecedented EUR1.85 trillion (USD2.1 trillion) EU budget and coronavirus recovery fund entered its second day with tensions running high.

A full day and night of discussions by the 27 leaders on Friday only added to the irritations over how the huge sums should be spent and what strings should be attached.

The atmosphere “was grumpier” as the talks went on, Dutch Prime Minister Rutte told Dutch reporters after Friday’s marathon talks. “This is going to take a while, I think.”

The EU executive has proposed a EUR750 billion fund, partly based on common borrowing, to be sent as loans and grants to the most needy countries.

That comes on top of the seven-year EUR1 trillion EU budget that leaders were fighting over when COVID-19 slammed their continent.

European Union leaders during a roundtable meeting at an EU summit in Brussels. PHOTO: AP

A European diplomat said overnight that the talks had hit a “difficult moment” and were blocked on the issue of how to monitor the recovery funds, and that it was unclear whether there would be a way out. The diplomat spoke on condition of anonymity because they were not authorised to publicly discuss the content of the closed-door negotiations.

Rutte is seen as a leader of four “frugal” nations that want conditions such as economic reforms attached to EU handouts to help countries recover from the hammer blow of the coronavirus.

He met yesterday ahead of the summit for crisis talks with German Chancellor Angela Merkel, French President Emmanuel Macron, Italy’s Giuseppe Conte as well as the leader of the EU’s executive, Ursula von der Leyen, and summit host Charles Michel.

One of Rutte’s allies, Austrian Chancellor Sebastian Kurz, said the talks were not totally stalled. “There is more and more movement in our direction,” he told ORF television.

The pandemic sent the EU into a tailspin with the 27-nation bloc’s economy contracting by 8.3 per cent this year, according to the latest predictions. Around 135,000 of its citizens have died from COVID-19.

As leaders met in person for the first time since February, they wore face masks, bumped elbows and sat in a cavernous meeting hall so they could maintain social distancing. Many of their negotiating positions were further apart than their chairs.

After two fruitless sessions on Friday, summit host and European Council President Charles Michel met key players – Rutte, French President Emmanuel Macron and Hungary’s Viktor Orban – in an attempt to narrow the gaps between them.

Orban does not want strings attached to EU funds, Rutte does and Macron is arguing that Europe must show solidarity to claw its way out of the crisis.

Macron and Rutte were among early arrivals at the summit venue yesterday morning.

Czech Prime Minister Andrej Babis was pessimistic after the first day. “I don’t have the impression that we are getting close to an agreement,” he said.

Rutte, however, said that despite the mounting acrimony, the talks were creeping forward.

“You make a bit of progress during the day,” he said. “For a start, it helps if you better understand each other’s positions, then you can search for possible compromises.”