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The US-based media outlet, Politico, outlines five sticking points that continue to impede the European Union’s (EU) negotiations on the long-term budget and recovery fund.

  • Five countries — Austria, Denmark, Finland, the Netherlands and Sweden — are pushing for a lower level of spending, and in particular a reduced sum for grants in the Recovery Instrument.
  • National governments need to submit detailed investment plans and win approval from the bloc before money can be allocated — a challenging process for some bureaucracies.
  • Countries are also split on whether borrowed recovery money should be repaid starting in 2028 — as proposed by the Commission — or earlier. 
  • The Commission’s proposal to distribute €310 billion of recovery funding based on a formula that would take into account unemployment between 2015 and 2019 has sparked controversy in capitals from Dublin to Budapest.
  • The European Parliament and a large coalition of countries are pushing for new sources of income to help ease pressure on the size of contributions into the budget, so-called own resources.

The European leaders are working hard to reach a consensus ahead of a summit July 17-18 on the bloc’s budget and recovery plans. The talks scheduled on July 8 will be closely eyed for fresh cues.