European Union flags flutter outside the European Commission headquarters in Brussels (Reuters)
A new European proposal to reduce the long-term budget of the European Union
A new negotiating proposal has been put forward for the European Union's next long-term budget, which requires it to be reduced by about 159 billion euros compared to the original proposal of the European Commission.
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A new negotiating proposal has been put forward for the European Union's next long-term budget, which requires it to be reduced by about 159 billion euros ($178.13 billion) compared to the original proposal of the European Commission.
The scenario presented by the current Irish presidency of the Council of the European Union in Brussels stipulates setting the financial framework for the period from 2028 to 2034 at 1.826 trillion euros, instead of about 1.985 trillion euros. The two amounts were calculated at current prices, that is, taking into account expected inflation during the seven-year budget period.
The vision proposes making particularly significant cuts in areas where the European Commission intended to increase spending in the future, namely enhancing competitiveness, scientific research, defence, foreign policy, and development policy. On the other hand, the major traditional items in the budget, namely agricultural policy and cohesion policy, will remain largely unaffected.
The cohesion policy aims to reduce economic and social disparities between the various regions of Europe, and its benefits mainly benefit the poorer member states of the European Union.
An agreement on the next long-term European budget is expected to be reached by the end of this year. But it is still doubtful that the new scenario will enable rapid progress in the negotiations.
Germany and a number of other major countries that contribute to the budget more than they receive from it - such as the Netherlands, Sweden, and Austria - have called on the Irish Presidency of the Council to reduce the draft budget by hundreds of billions of euros.
A European diplomat described the Irish proposal on Saturday as disappointing, and does not even reach a level that could be considered a possible basis for reaching an agreement. He said that the planned large increase in spending cannot be afforded, and that the proposal, by favoring political priorities dating back to the twentieth century, does not prepare the European Union to face the challenges of the twenty-first century.
The diplomat added: “We urgently need more financial realism and less financial illusions.”
The European Union budget is mostly financed from a share taken from the gross national income of member states. As the largest economy in the European Union, Germany makes the largest contribution, with a clear difference from the rest of the countries.
On Saturday, Beijing considered that China and the European Union could avoid “escalation” in the various disputes between them, in light of increasing fears of the outbreak of a trade war that could have negative repercussions.
The Chinese Ministry of Commerce said in a statement published on Saturday that the talks that took place last week in Beijing between Chinese Minister of Commerce Wang Wentao and his European Union counterpart Maroš Šefčović were “successful” and constituted a “new starting point.”
The statement pointed out that "the results and consensus reached by the two sides are clear evidence that China and the European Union have the will and wisdom to manage differences and address them properly through dialogue and consultation, and effectively avoid escalation of frictions."
Shevcovic said on Friday, after the conclusion of two-day talks, that Beijing had agreed to “control” its exports of hybrid cars to the 27-nation European bloc, as local car manufacturers face increasing pressure from Chinese competition.
The European Union trade official told reporters that the agreement “opens up prospects for reducing China’s exports (of hybrid cars) by more than half,” based on forecasts covering a period of four years.
Car shipments to the European Union are among the most controversial issues within China's growing trade surplus with the bloc, which currently amounts to about one billion euros ($1.1 billion) per day.
Many in Europe accuse China of unfair trade practices, including supporting companies with huge subsidies, flooding markets with low-priced products, and currency manipulation.
What further exacerbates this issue is the ongoing stagnation in domestic demand within the Chinese economy, which prompts manufacturers to search for alternative markets abroad.
A joint statement published on Friday said that the two sides “reached an understanding on the trade of hybrid cars in a manner consistent” with World Trade Organization rules, describing the talks as “intensive.”
The Chinese Ministry of Commerce stated on Saturday that the talks included “in-depth discussions on the trade of electric and hybrid cars, avoiding escalation of the situation, and effectively protecting the actual export interests of Chinese companies.”
During the talks, China pledged to continue supplying vital materials, including rare metals, to the European Union, an issue that has been closely monitored since Beijing imposed a requirement to obtain export licenses last year.
The two sides will continue to "intensify work on important economic and trade issues of common interest," the Chinese Ministry of Commerce announced, adding that the next meeting of this kind will be held in March.
The Central Bank of Iraq announced, on Saturday, that merchants will not be charged the new price differences for exchanging the dollar for remittances that were proven to be purchased and covered at the previous price before the seventh day of this month.
The Iraqi markets witnessed turmoil after the Central Bank of Iraq's sudden decision to raise the dollar exchange rate in the draft federal general budget for the fiscal year 2027 from 1,320 dinars to 1,520 dinars per dollar.
The Central Bank of Iraq said, in a press statement, on Saturday, regarding merchant transfers due for implementation, that it follows up the banking operations carried out before and after adjusting the dollar exchange rate, and verifies the banks’ compliance with the instructions and controls in force, in a way that ensures the protection of the rights of merchants and customers.
He called on companies and merchants whose transfers for financing imports were due for implementation before the seventh of this month to review their banks and ensure their implementation, especially since the Central Bank had previously enhanced bank accounts to cover those transfers, follow up on any delays, and verify that merchants are not charged the exchange rate differences for transfers that were proven to be purchased and covered at the previous price.
The bank stressed that “in the event of a delay in implementation or a request for additional amounts, a complaint can be submitted through the complaints platform of the Central Bank of Iraq to follow up with the relevant bank,” noting that it is working in coordination with banks and electronic payment companies to launch special cards for foreign trade for small merchants to facilitate financing their imports, in accordance with the mechanisms and controls determined by the bank.
Adjusting the exchange rate of the dollar in Iraq caused its prices to rise in the parallel market to 1,665 dinars, and a significant increase in the prices of basic goods and electrical appliances.
