Friday

24th Nov 2017

Barroso fights to keep investment pot in EU budget

  • Let's get connected, says the commission. Member states have yet to be convinced however (Photo: European Commission)

The European Commission has started banging the drum for new €50bn pot of money that it says will reinvigorate Europe's economy amid fears that penny-counting member states will give it the chop.

With just weeks to go until EU leaders are supposed to decide on the bloc's budget for 2014-2020, commission president Jose Manuel Barroso urged member states to be open to the 'Connecting Europe Facility' (CEF), an investment pot for joining up transport, digital and energy networks.

Thank you for reading EUobserver!

Subscribe now for a 30 day free trial.

  1. €150 per year
  2. or €15 per month
  3. Cancel anytime

EUobserver is an independent, not-for-profit news organization that publishes daily news reports, analysis, and investigations from Brussels and the EU member states. We are an indispensable news source for anyone who wants to know what is going on in the EU.

We are mainly funded by advertising and subscription revenues. As advertising revenues are falling fast, we depend on subscription revenues to support our journalism.

For group, corporate or student subscriptions, please contact us. See also our full Terms of Use.

If you already have an account click here to login.

"There is a difficulty in Europe about new ideas," Barroso said Tuesday (2 October) and urged business - which is largely in favour of the idea - to "make your voices heard."

Member states are due to decide on the EU budget at a special summit in November. The EU commission last year proposed increasing spending by 5 percent to €971.52 billion over the seven-year period. But the negotiations have thrown up two main camps - richer states who want to chop the proposed budget and poorer countries who want to maintain regional aid. Diplomats suggest a compromise may be found by reducing the CEF.

The countries in favour of Cohesion Policy (regional funding) and agricultural policy are "very well organised" said Barroso admitting that "there is not yet a team CEF."

Arguing the case, he noted some are always in favour of paying out for national projects but will not sign the cheques for cross-border plans. "This is why we need the European dimension," he said, adding the geopolitical arguments of the importance making Europe self-reliant in energy and "making Europe large and influential" in the world.

Business leaders at Tuesday's commission-organised conference kept their arguments practical.

Leif Johansson, chair of mobile phone giant Ericsson, said his and other large companies were "keenly aware" of which member states had integrated energy network and which do not.

Linking up the "patchwork" transport system so that it is easier to get goods from A to B in the EU would be his second priority.

"I like very much that this project is purely business-focussed," said Maciej Witucki, President of Telekomunikacja Polska. He said that while local governments - who often get money through the EU's regional aid - are good at building local roads and water pipes they "can't do" fibre networks for high-speed internet connections.

The €50bn the commission is proposing is a tiny amount when compared to the total needed - Europe's core transport network will alone require €250bn in investment. Other money will have to come from the private sector, member states and the European Investment Bank.

But sometimes EU support is enough to kick-start the process.

Dermot Byrne, Chief Executive of Eirgrid an Irish energy company, noted that receiving €110m in EU money for setting up Eirgrid sparked a chain of other investors.

EU money made it seem like it was a "project of significance" and this gave other lenders "confidence."

EU transport commissioner Siim Kallas, - whose dossier stands to benefit most (€31.7bn) from the proposed €50bn pot - tried to put the numbers in perspective.

The European Commission approved state aid to the tune of €4.5 trillion for financial institutions between 2008 and 2011, he said.

Member states continue budget bickering

EU ministers on Monday did not reach an agreement on the Cypriot presidency’s proposal for the bloc's next seven-year, €1 trillion budget.

EU budget hurdles mount

The EU is hoping for agreement on the next long-term budget by the end of the year but two opposing camps in the money negotiations remain about €100bn apart.

Regions & Austerity

For one week every year European regions are in the spotlight. It’s called Open Days, lasts a week, and is dedicated to all issues regional and local. To mark the event, EUobserver takes Europe’s regional temperature.

Parliament backs €9 billion EU budget hike

MEPs defied calls by national governments to rein in EU budget spending on Thursday, instead restoring most of the €138 billion settlement proposed by the European Commission for the 2013 budget.

Stakeholders' Highlights

  1. Nordic Council of MinistersNordic Energy Ministers Pledge to Work More Closely at Nordic and EU Level
  2. European Friends of ArmeniaLaunch of Honorary Council on the Occasion of the Eastern Partnership Summit and CEPA
  3. International Partnership for Human RightsEU Leaders Should Press Azerbaijan President to End the Detention of Critics
  4. CECEKey Stakeholders to Jointly Tackle the Skills Issue in the Construction Sector
  5. Idealist Quarterly"Dear Politics, Time to Meet Creativity!" Afterwork Discussion & Networking
  6. Mission of China to the EUAmbassador Zhang Ming Received by Tusk; Bright Future for EU-China Relations
  7. EU2017EEEstonia, With the ECHAlliance, Introduces the Digital Health Society Declaration
  8. ILGA EuropeFreedom of Movement For All Families? Same Sex Couple Ask EU Court for Recognition
  9. European Jewish CongressEJC to French President Macron: We Oppose All Contact With Far-Right & Far-Left
  10. EPSUWith EU Pillar of Social Rights in Place, Time Is Ticking for Commission to Deliver
  11. ILGA EuropeBan on LGBTI Events in Ankara Must Be Overturned
  12. Bio-Based IndustriesBio-Based Industries: European Growth is in Our Nature!

Latest News

  1. EU awaits UK proposals in final push for Brexit breakthrough
  2. Berlin risks being 'culprit' for stalling EU, warns Green MEP
  3. Eastern partners, eastern problems
  4. Germany's Schulz under pressure to enter coalition talks
  5. LuxLeaks trial re-opens debate on whistleblowers' protection
  6. Wilders says Russia is 'no enemy' ahead of Moscow visit
  7. EU must put Sudan under microscope at Africa summit
  8. Mali blames West for chaos in Libya