June 4, 2020 / 10:39 AM / a month ago

Germany hinges EU recovery funding on democratic values

BRUSSELS/BERLIN (Reuters) - Germany, set to take over the European Union’s rotating presidency on July 1, will put the rule of law at the heart of the bloc’s economic recovery from the coronavirus pandemic, a policy note said in an apparent swipe at Poland and Hungary.

FILE PHOTO: German Chancellor Angela Merkel speaks to Hungarian Prime Minister Viktor Orban during a news conference after a summit of the leaders of the Visegrad Group and Germany, in Bratislava, Slovakia, February 7, 2019. REUTERS/David W Cerny

Germany will take the EU helm for six months as the 27 member states debate a mass stimulus programme to kickstart growth on the continent amidst a series of feuds that could hold up the required unanimous agreement.

Lines in the sand against making access to EU funds conditional on rule of law standards have already been drawn by Poland and Hungary, whose populist, eurosceptic governments have outraged other member states and rights groups by placing media, judges and academics under closer state control.

“The plan for recovery must be based on solidarity, cohesion and convergence...while fully respecting our values, rights, and the rule of law,” said the note, seen by Reuters.

It was also signed by Slovenia and Portugal, which will take over the EU baton for six months each in 2021.

The 27 EU member states will first lock horns on June 19 over a recovery proposal by the bloc’s executive to raise an unprecedented 750 billion euros worth of debt to top up spending from joint coffers to be worth 1.1 trillion euros in 2021-27.

Under the scheme, the executive European Commission could recommend suspending or withdrawing funds from a country flouting the rule of law, with a majority of EU states needed to block any such punishment.

That system would make it harder for Warsaw, Budapest or any other perceived offender to avoid forfeiture, compared to an earlier plan that would require a majority to vote in favour of any sanction proposed by the Commission for it to be enacted.

Pressure from the European Union, rights groups and international watchdogs has largely failed, however, to prevent an erosion of democratic checks and balances in the formerly communist eastern members of the bloc in recent years.

Other disputes over the proposed stimulus package include divisions between the EU wealthier northern countries and the financially ailing south over how to raise the money, how to spend it and, eventually, how to pay it back.

Writing by Gabriela Baczynska; Editing by Mark Heinrich

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