France and Germany reach deal on farm spending
France and Germany tonight reached a deal on farm spending that boosted chances of success at an EU summit to finalise the bloc’s expansion into eastern Europe.
Chancellor Gerhard Schroeder said he and Jacques Chirac had agreed to place a ceiling on farm spending in 2006, two years after 10 mostly eastern European nations are scheduled to join the EU.
The deal would appear to allay German fears that the expansion would bust the EU’s bank once millions of farmers from Poland and the other nations enter the Union.
It also seemed to set the EU summit on track to wrap up a deal on how to pay for the expansion and bring about the reunification of Europe after decades of Cold War division.
“France and Germany are determined that this historic opportunity ... will not be missed,” Schroeder said after his meeting with Chirac in Brussels.
Denmark’s Prime Minister Prime Minister Anders Fogh Rasmussen, who was chairing the two-day EU summit, was visibly relieved at the Franco-German deal, but warned that a full agreement was still needed among all 15 members on how to pay the expansion.
“This is a question for 15 member states of the European Union but of course we welcome the agreement between France and Germany,” Fogh Rasmussen said as the summit opened.
“It definitely has not made the summit more difficult,” he joked.
France and Germany had been deadlocked over how to share out the costs of bringing in the candidates, who are all poorer than the EU average, and should be eligible for a generous slice of huge budget that the Union gives out to its farmers and poorest regions.
France had resisted cuts in subsidies to its powerful farm lobby for decades and insisted the agricultural handouts cannot be touched until 2006, when the whole EU budget is up for renegotiating
The compromise struck at Chirac and Schroeder’s tete-a-tete would phase in direct payments for the new members from 2004, leave overall agriculture spending untouched for two years, then freeze farm spending at 2006 levels.
Chirac warned other countries would have to make sacrifices when the budgets was reformed in 2006.
Fogh Rasmussen appealed to the other EU nations to follow up the Franco-German deal.
He insisted an EU agreement is needed in Brussels to give the candidate nations time to negotiate the subsidy package before they sign on for membership in December at another summit in the Danish capital Copenhagen.
“We must have an agreement if not we risk postponing the enlargement,” the Danish premier said.
“During the coming days the European council has an historic chance to unite our continent. We must not hesitate, the time has come to deliver on our promises.”
The spending spat has clouded the EU’s expansion programme, just days after it was set on course by a referendum vote in Ireland that approved the EU’s blueprint for taking on the new members.
Aside from farm spending the EU also as to resolve differences over a plan by the EU’s head office to spend €25bn developing economies of the newcomers’ poorest regions over the first three years of their membership.
Germany says that package – which will cover projects ranging from roads and railways to schools and restoring tourist sites – is too much.
Under the expansion timetable, Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia and Slovenia are due to conclude four years of membership talks at the Copenhagen summit.
In April, they are scheduled to sign the accession treaties at a ceremony in Athens, Greece, leaving the rest of the year for parliamentary ratification before they join on January 1, 2004.
