EU leaders face choice: Build unity or present ‘a weak Europe’

Calling on EU leaders to build "unity and trust," a heart-tugging speech by the European council president sparked a glimmer of hope as EU leaders entered the fourth day of negotiations over a $2.1 trillion budget and coronavirus relief fund.

First Look

Weary and bleary, European Union leaders on Monday geared up for a fourth day of fighting over an unprecedented $2.1 trillion EU budget and coronavirus recovery fund, barely recovered from a weekend of walkouts, fists slamming into tables, and insults.

With a brilliant sun warming the negotiating sundeck at the Europa summit center early Monday, there finally was a glimmer of hope that the talks to help the continent emerge from the pandemic through an unprecedented economic aid package aren’t doomed after all.

It took a heart-tugging dinner speech by European Council President Charles Michel about leaders not failing their union, French President Emmanuel Macron slamming his fist in anger into the table, and a new set of budgetary numbers to send this already epic summit onward.

“There were extremely tense moments. And there will be more that no doubt will still be difficult. But on content, things have moved forward,” said Mr. Macron, stressing his continued partnership with German Chancellor Angela Merkel. Without Franco-German agreement, the EU has never taken momentous steps.

“An extraordinary situation demands extraordinary efforts,” Ms. Merkel said as the leaders were heading into one of the bloc’s longest summits ever. It was planned as a two-day summit scheduled to have ended Saturday, but deep ideological differences between the 27 leaders forced the talks into two extra days.

Overall, spirits had picked up since the talks reached rock bottom Sunday night.

“It looks more hopeful than when I thought during the night: ‘It’s over,’” said Dutch Prime Minister Mark Rutte, the target of much of criticism for keeping a compromise impossible.

Mr. Rutte, defending the cause of a group of five wealthy northern nations – the Netherlands, Austria, Finland, Sweden, and Denmark – sought to limit costs and impose strict reform guarantees on any rescue plan for needy nations. He came under criticism from Mr. Macron, Italy, and Hungary, whose Prime Minister Viktor Orban asked why the Dutchman had such “hate” toward him.

Mr. Rutte took it in stride.

“We are not here because we are going to be visitors at each other’s birthday party later. We are here because we do business for our own country. We are all pros,” he said.

On Sunday night, after three days of fruitless talks and with hope dimming, Mr. Michel implored leaders to overcome their fundamental divisions and agree on the budget and recovery fund.

“Are the 27 EU leaders capable of building European unity and trust or, because of a deep rift, will we present ourselves as a weak Europe, undermined by distrust,” he asked the leaders.

“I wish that we succeed in getting a deal and that the European media can headline tomorrow that the EU succeeded in a Mission Impossible,” Mr. Michel said.

The pandemic has sent the EU into a tailspin, killing around 135,000 of its citizens and plunging its economy into an estimated contraction of 8.3% this year.

The bloc’s executive has proposed a 750 billion-euro coronavirus fund, partly based on common borrowing, to be sent as loans and grants to the countries hit hardest by the pandemic. That comes on top of the seven-year 1 trillion-euro EU budget that leaders had been haggling over for months even before the pandemic hit.

Even with Mr. Macron and Ms. Merkel negotiating as the closest of partners, the traditionally powerful Franco-German alliance could not get the quarreling nations in line.

At their dinner table Sunday night, the leaders mulled a proposal from the five wealthy northern nations that suggested a coronavirus recovery fund with 350 billion euros of grants and the same amount again in loans. The five EU nations – nicknamed “the frugals” – had long opposed any grants at all, while the EU executive had proposed 500 billion euros.

The latest compromise proposal stands at 390 billion euros in grants.

All nations in principle agree they need to band together but the five richer countries in the north, led by the Netherlands, want strict controls on spending, while struggling southern nations like Spain and Italy say those conditions should be kept to a minimum. The five have been pushing for labor market and pension reforms to be linked to EU handouts and a “brake” enabling EU nations to monitor and, if necessary, halt projects that are being paid for by the recovery fund.

“He can’t ask us to do specific reforms,” Italian Prime Minister Giuseppe Conte said. 

Mr. Rutte and others also wants a link to be made between the handout of EU funds and the rule of law – a connection aimed at Poland and Hungary, countries with right-wing populist governments that many in the EU think are sliding away from democratic rule.

That drew Mr. Orban’s anger.

This story was reported by The Associated Press.

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