Early deal on EU budget now unlikely

EU/Brussels: The prospect of an early deal on the EU's next seven-year budget has receded after Germany's decision to bring …

EU/Brussels: The prospect of an early deal on the EU's next seven-year budget has receded after Germany's decision to bring forward its federal election to this autumn.

The European Commission and EU governments acknowledged that an election campaign in Europe's biggest country made finding agreement more difficult.

Speaking after an EU foreign ministers' meeting marked by sharp differences over the budget, Minister for Foreign Affairs Dermot Ahern said that the German decision made a deal more elusive.

"It doesn't help," he said.

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Mr Ahern's comments were echoed by the commission's chief spokeswoman and by Spanish foreign minister Miguel Angel Moratinos.

"The negotiations were complicated already, but the election in Germany makes them even more difficult," Mr Moratinos said.

A special meeting of foreign ministers in Brussels on Sunday failed to narrow differences between countries that want the EU budget capped at 1 per cent of Gross National Income (GNI) and those that want a more generous budget.

"If you were to listen to the diametrically opposed views around the table last night, there's no movement. But things change," Mr Ahern said.

Mr Ahern argued against any reopening of a 2002 deal on funding of the Common Agricultural Policy until 2013, but acknowledged that Ireland would receive less aid from the EU in the future. "It's obvious that the country will not do as well as we did in the last round. We will become a net contributor during the next budget term," he said.

The EU does not have to agree its 2007-2013 budget until next year but Luxembourg's prime minister, Jean-Claude Juncker, whose country holds the EU presidency, hopes to secure a deal at next month's meeting of EU leaders. A deal under Britain's six-month presidency, which starts on July 1st, is unlikely because of London's determination to keep its budget rebate despite opposition from all other 24 member states.

Luxembourg's foreign minister, Jean Asselborn, said yesterday that his country's presidency would continue to work towards a deal at next month's summit despite the German election decision. "If this decision yesterday to dissolve parliament makes our task a bit more difficult, I don't think it dooms it to failure. We will continue trying to convince all sides to move Europe forward," he said.