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Brussels, October 17:
The two-day European Union (EU) summit concluded on Friday without reaching a concrete consensus on the upcoming long-term budget. Rising security costs, surging energy expenses, and persistent disagreements among member states have posed significant challenges to implementing Europe’s ambitious plans.
Held in Brussels, the summit primarily focused on the challenges of securing an agreement on the long-term budget, increases in defense spending, tensions with the United States, and the impact of the energy crisis on the European economy.
Disagreements Over the Long-Term Budget
The European Commission has proposed a budget of approximately 2 trillion euros ($2.24 trillion) for the period from 2028 to 2034. The budget aims to boost investments in competitiveness, defense, and technology.
A recent compromise proposal presented under Ireland’s presidency suggested cutting about 141 billion euros from the Commission’s plan. However, this proposal faced sharp disagreement among member states.
European Commission President Ursula von der Leyen stated that the proposed cuts would halve the budget’s flexibility, locking 99.5 percent of the funds into pre-determined allocations. She expressed concern that the proposal would overly constrain the bloc.
According to the Brussels-based think tank Bruegel, six fiscally conservative countries led by Germany have supported a smaller budget. Meanwhile, 17 nations, including Italy and Spain, have maintained that funding for agricultural subsidies and regional development must be protected.
Fabián Zuleeg, chief executive of the European Policy Centre, noted that relying solely on national budgets will make it difficult to meet Europe’s growing investment needs, arguing that new financial instruments such as joint borrowing must be considered.
Rising Security Costs and Tensions with the U.S.
The war in Ukraine has further complicated Europe’s security expenditure challenges. Ukrainian President Volodymyr Zelenskyy stated that 155 billion euros will be required for the war effort in 2027 and requested an additional 70 billion euros in aid.
While the EU has already agreed to provide Ukraine with a 90 billion euro loan for 2026–2027, evaluations regarding additional financial needs remain ongoing.
The EU expressed dissatisfaction with the U.S. decision to temporarily ease sanctions on Russia to lift restrictions on Russian diesel supplies. Additionally, restrictions placed on the Starshield satellite communication service—controlled by the U.S.—have disrupted Ukrainian military activities, highlighting Europe’s heavy security dependencies.
EU Foreign Policy Chief Kaja Kallas stated that Starlink services are indispensable for Ukraine and that Europe cannot provide an immediate alternative.
Energy Crisis and Climate Policy Disputes
Rising energy costs have also intensified economic pressure on the bloc. According to Commission President von der Leyen, the Middle East conflict has added 106 billion euros to the EU’s fossil fuel import costs.
Meanwhile, the International Energy Agency has advanced a plan to release an additional 100 million barrels of oil onto the market over the next four months. The European Commission is also working on measures to temporarily support energy-intensive industries and improve refining capacities.
However, divisions remain deep regarding climate policies. Italy, Greece, and four countries of the Visegrád Group have demanded that the second phase of the Emissions Trading System (ETS-2) be postponed until 2030. Conversely, Nordic countries have opposed the delay, warning it could negatively impact long-term climate targets and investments.
The summit failed to reach a consensus on postponing the system, with leaders instructing further evaluations regarding its structure, impact, and safeguard measures.
Amid mounting economic pressures and conflicting national interests, implementing unified policies has become increasingly difficult, leaving European leaders struggling to agree on who will bear the costs rather than merely setting shared goals.
RSS / Unified Nepal
