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EU: Aid Debate Pits Poorer Members Against Candidate States

A two-day conference in Brussels on the future of European Union development aid after enlargement has highlighted dangerous tensions between the EU's poorer members and candidate countries. Current beneficiaries of the EU's so-called cohesion funds, led by Spain, insist on retaining present aid levels. Under current EU budget rules, this would mean less aid to future members, even though most of them are poorer than Spain. RFE/RL Brussels correspondent Ahto Lobjakas reports.

Brussels, 22 May 2001 (RFE/RL) -- The notion of solidarity underpinning the EU's so-called cohesion policy of distributing billions of euros annually to the bloc's poorer members is becoming dangerously strained.

For weeks now, the EU's poorer members, led by Spain, have hinted they are prepared to put a brake on accession talks to avoid losing aid to future members.

Under current rules, poor regions within the EU qualify for development aid if their per capita gross national product, or GNP, is below 75 percent of the EU average. As most candidate countries are poorer than even the poorest current members, expansion to Central and Eastern Europe would mean member-states like Spain, Portugal, and Greece risk losing most of the subsidies they currently receive.

A conference held in Brussels yesterday and today under the auspices of the European Commission has failed to break the deadlock.

Leaders of the European Commission repeatedly appealed to current members to extend the current notion of solidarity to new members. Today, the EU's enlargement commissioner, Guenter Verheugen, warned the bloc's 15 members against creating new obstacles to enlargement, saying this could lead to increased opposition to accession in candidate countries.

Verheugen insisted the notion of solidarity, which has underpinned much of the EU's recent development, must be extended to candidate countries.

"One fact cannot be avoided in this discussion. It is the commitment to community solidarity which is at the core of the European Union. It must not remain empty words, it must be practiced. The accession of economically weaker nations will mean the stronger have to carry a heavier burden. This goes for all -- for those who are stronger, and for some of those who will join."

Verheugen said that to enable accession talks to proceed according to the timetable endorsed by the Nice summit five months ago, debates about future levels of development aid will have to wait until 2006. At Nice, the EU committed itself to being prepared to accept new members by the end of 2003. EU leaders also expressed the collective hope that the first new members could participate in the next elections of the European Parliament in June 2004.

The message of Nice appears to have fallen on deaf ears, however. Spain's Finance Minister Cristobal Montoro Romero said this week that although his country supported enlargement, it could not ignore the economic impact of new accessions on Spain. He said the economic impact of enlargement should be discussed within the framework of accession talks -- that is, well before 2006.

Romero's comments echo a demand made by the Spanish government last week that the EU's Gothenburg summit next month (14-15 June) adopt a political declaration that specifies development aid received by Spain will not fall significantly after enlargement. Germany, the EU's biggest net contributor, has rejected the demand.

Although Spain insists there is no formal link between its concerns on development aid and expansion talks, it has meanwhile blocked agreement on an EU common position on worker movement after expansion. Without a common position, talks with leading candidates will stall.

At this week's Brussels conference, Spain's demands were also explicitly rejected by representatives of candidate countries. The Spanish position was publicly criticized by, among others, Jerzy Buzek, prime minister of Poland -- a country as populous as Spain, but considerably poorer.

"We expect that the funds per capita for new member-states in cohesion policy and cohesion and structural funds will be no less than the funds per capita in old members. If we don't have [this], it will be very difficult for poor regions to catch [up] in [the] future [to] the rich regions in Europe."

Buzek went on to say that any distinctions in funding between old and new members were "politically unacceptable" for Poland and would be rejected by the Polish public. He also criticized an earlier finding by the European Commission that candidate countries would be unable to absorb development aid that exceeds 4 percent of their GNP. Present recipients of EU development aid receive considerably more.

A recent study by Germany's private Dresdner Bank estimated that candidates would need annual investments upwards of 6 to 7 percent of their GNP to stand a realistic chance of catching up with the EU.

With differences on future funding running deep, the issue risks overshadowing the EU's Gothenburg summit in three weeks. It now appears that the summit will pit the EU's poorer members against both richer members intent on reducing their costs and candidate states intent on receiving what they consider their fair share of aid.