Key facts
- Germany is demanding a €400 billion ($456 billion) cut to the European Commission's proposed €2 trillion EU budget for 2028-2034.
- Berlin argues the current budget plans are 'unaffordable' and an agreement is impossible as they stand.
- The proposed budget is a significant increase from the €1.3 trillion budget for 2021-2027.
- Even with the proposed cut, Germany's annual contribution would exceed €50 billion.
- Chancellor Friedrich Merz stressed the need for a deal this year to ensure planning certainty.
Germany is demanding a substantial €400 billion ($456 billion) reduction in the European Commission's proposed €2 trillion budget for the 2028-2034 period, warning that the current plans are 'unaffordable.' According to an internal government document seen by Reuters, Berlin believes an agreement is impossible in its current form, highlighting a potentially contentious negotiation process as all 27 member states must unanimously approve the budget.
As the EU's largest net contributor, Germany is alarmed by the proposed seven-year budget's significant increase compared to the €1.3 trillion allocated for 2021-2027. Even with Germany's proposed trim, the budget would still be 27% larger than the current one, pushing Germany's annual contribution to over €50 billion.
Chancellor Friedrich Merz has called on member states to finalize a deal this year to provide planning certainty before the budget takes effect in January 2028, particularly with major elections anticipated in France, Poland, and Italy in 2027.