The Polish and Hungarian authorities announced that they have reached an agreement with the leadership of European Union on a seven-year budget , which is expected to save the European economy, writes Bloomberg .
According to Deputy Prime Minister of Poland Yaroslav Govin, Warsaw and Budapest managed to come to an agreement with Germany, which holds the EU presidency, and agree on a new seven-year budget for 2021-27. Its total volume will amount to 2.2 trillion euros (against 960 billion in 2014-20).
750 billion euros of the total funds will go to the formation of a fund to support the European economy, which will be financed through the placement of bonds on behalf of European Commission . 500 billion will be distributed among the countries most affected by the coronavirus pandemic in the form of grants, another 250 billion in the form of concessional loans. The rest of the budget will come from EU member contributions.
The adoption of the seven-year financial plan was blocked by Poland and Hungary, which did not agree with the key principle of the distribution of funds. According to him, the amount of funding for each country directly depends on how it follows the standards of the rule of law. Warsaw and Budapest were often criticized by Brussels for deviating from them, in particular because of the new Polish law, which effectively banned abortion in the country.
Govin did not disclose the details of the agreement with Germany, but noted that it would “preserve the sovereignty of Poland and the EU.” In case of a breakdown of the agreements, the European Union would have to use an emergency budget from January, which would mean a reduction in funding for the main items of expenditure.