Germany's government sharply criticized a Cypriot proposal to trim the EU's long-term budget, calling it "unaffordable" and "unbalanced." Berlin advocates for cuts across all areas, prioritizing defense and competitiveness.
Disagreements over the EU's long-term budget highlight divisions among member states regarding spending priorities and fiscal discipline, potentially impacting future EU funding for key policy areas like defense, competitiveness, agriculture, and cohesion.
Germany's government, led by Chancellor Friedrich Merz, has sharply criticized a Cypriot proposal to reduce the European Union's long-term budget, deeming it "unaffordable" and "unbalanced." The Cypriot government earlier this week put forward a plan for a 2 percent cut to the European Commission's proposed budget for 2028-2034.
German officials stated that the proposal could not serve as a basis for agreement and that Berlin would not accept an "unaffordable or an unreformed multi-annual financial framework." Merz's government has consistently advocated for substantial cuts across all EU budget areas, emphasizing a need for prioritization of defense and competitiveness spending while seeking savings in agriculture and cohesion funds. Merz argued that citizens expect Brussels to exercise restraint, similar to national governments consolidating their budgets.
German officials expressed a desire to finalize budget negotiations this year, citing potential complications from elections in France and Spain next year. However, they indicated that the current proposal was far from an agreement and suggested that Ireland, set to assume the Council presidency in July, would need to table a revised proposal to meet the target of finalizing the budget by the end of 2026. Berlin is open to discussions on new revenue sources if they offer clear added value, but considers the proposed corporate levy unacceptable.