Budget rows overshadow EU economy summit
European leaders thrashed out plans on Friday (24/10/2014) to revive the moribund economy despite rows with Italy and France over their budgets, while Britain angrily fought a demand from Brussels for more money.
The heads of the 28 member states met in Brussels just hours after negotiating deep into the night a landmark deal on climate change targets for 2030.
On the agenda was the troubled European economy and a much talked about promise by incoming European Commission chief Jean-Claude Juncker to unveil a 300-billion-euro (380-billion) investment plan by Christmas.
But their discussions on the economy, amid global concerns that hit markets last week, will also focus on the budgets submitted by Paris and Rome last week.
France and Italy, the second and third biggest eurozone economies, have said they will break EU spending rules imposed after the devastating eurozone debt crisis.
Italian Prime Minister Matteo Renzi threw a firecracker into the process overnight when he announced his intention to make public the cost of the European institutions amid the row over Rome's budget.
European Commission head Jose Manuel Barroso had sharply criticised Italy for publishing a letter from the EU marked strictly confidential that requested clarifications on Rome's rule-breaking budget.
"We will publish data on everything that is spent by these palaces. We're going to have some fun," Renzi said.
Despite the tough talk, sources said Italy and France, as well as three other smaller countries under the microscope, are trying to find a face-saving deal with the EU.
French President Francois Hollande insisted no budget changes were planned - but also said there might be ways to "better calculate" certain expenditures in the Paris budget.
Meanwhile Prime Minister David Cameron was embroiled in a fresh showdown with Brussels after the EU demanded an extra 2.1 billion euros (2.6 billion) from Britain under new budgetary calculations because its economy is thriving while Europe stalls.
The surcharge is a fresh blow for Cameron, who faces an election in May and has promised an in-out referendum on Britain's EU membership in 2017 to curb a growing threat to his Conservative party from eurosceptic leader Nigel Farage.
Adding insult to injury in British eyes, France will be owed 1.0 billion euros by the EU while Germany, the bloc's most powerful and richest economy, gets a rebate of 779 million euros.
"It's not acceptable to just change the fees for previous years and demand them back at a moment's notice," a source in Cameron's office said.
Cameron will work with Dutch Prime Minister Mark Rutte to challenge the demand after the Dutch government was also tapped for more funds.
The surcharge is based on a revision in the way that the economic output of EU states is calculated dating back to 1995, a figure which includes previously hidden elements such as drugs and prostitution, and the overall economic situation of each country.
After leaders of the 28 member states discuss the investment plan, the heads of state of the 18-member eurozone will break off for an informal lunch.
"I think we will discuss the French and Italian budgets," said Lithuanian President Dalia Grybauskaite. "We will discuss them diplomatically."
Meanwhile, EU leaders agreed to boost aid to combat the deadly Ebola virus in west Africa to one billion euros (1.26 billion). They had previously committed 600 million euros.
Cameron led calls to raise the money, urging his EU peers to match London's efforts to tame a disease which has killed some 4,900 people, mainly in Liberia, Sierra Leone and Guinea.
An EU Ebola "czar", the incoming Cypriot humanitarian aid commissioner Christos Stylianides, was named on Thursday.
The EU was also hailing its deal overnight for what it called the world's most ambitious climate change targets for 2030, paving the way for a new UN-backed global treaty in Paris next year.
The 28 leaders overcame deep divisions to agree on cutting greenhouse gas emissions by at least 40 percent compared to 1990 levels. They also agreed on 27 percent targets for renewable energy supply and efficiency gains. - AFP
