European leaders reach agreement on the EU multi-annual budget and the recovery plan previously vetoed by Hungary and Poland
Gathered in Brussels for a two-day summit, the EU leaders managed to unblock the situation regarding the EU budget and the coronavirus recovery plan, which had been vetoed by Hungary and Poland. Unhappy that access to European funds was made conditional on the observance of the rule of law, the two governments contested the new Rule of Law Mechanism. A compromise was eventually reached, and the Hungarian and Polish governments lifted their veto.
The European Rule of Law Mechanism, adopted by qualified majority following an understanding between the European Parliament and the German Presidency of the Council of the EU, allowed for the suspension of a member state's access to European funds if the European Commission considered that the said state was violating the rule of law, and provided the member states approved the measure by qualified majority. Stating that the mechanism had no clearly set criteria and could be used as an arbitrary political tool to sanction the countries that promote policies disliked in Brussels, on November 16th, the Polish and the Hungarian governments vetoed the EU's multi-annual budget.
The EU budget for 2021-2017, worth 1074 billion euro, and the Next Generation EU-Covid-19 recovery package, with a fund of 750 billion euro, were adopted in July. The member states will be able to access credits and grands from this package. According to the President of the European Council, Charles Michel, with the help of this plan economies can undertake the green and digital transitions.
Following the agreement, Romania will get 46.7 billion euros from the common budget, for various policies, from agriculture, cohesion or rural development to transport and infrastructure. Also, 33.5 billion were allocated to Romania from the recovery package, in the form of grants and credits. President Klaus Iohannis has stated that Romania is ready to use these funds for reforms and investments in key sectors.
According to the EU, the long-term budget and the Next Generation package, a temporary plan devised to boost recovery post-Covid19, will make up the largest incentive package funded from the EU budget. The new budget was conceived so as to strengthen flexibility mechanisms, in order to meet unforeseen needs.
Next Generation will help fix the economic and social damage caused by SARS Co-V2. It is hoped that, after the Covid-19 pandemic, Europe will be greener, more digital, more resilient and better prepared to meet current and future challenges. (M. Ignatescu)