BRUSSELS ― Political pressure is leaving Emmanuel Macron and Friedrich Merz poorly placed to break the deadlock over the EU’s next seven-year budget. As EU leaders gather for a two-day summit in Brussels from Thursday, the heads of the bloc's two largest countries hold the keys to breaking the impasse between capitals that has persisted for months, as a Germany-led group advocating a smaller budget clashes with those like France which are resisting reductions. "Delays and persisting divisions in the Council [representing EU governments] are worrying," said Siegfried Mureșan, co-leading the European Parliament's work on the MFF, the multiannual financial framework.
"The EU budget can only be built through compromise ... The faster we adopt the budget, the faster we can implement it and become more competitive, safer, help farmers and researchers and protect our borders and cyberspace." Sealing agreement on the EU's long-term central budget, worth approximately €2 trillion, is the biggest challenge over the next few months facing leaders, all of whom must . While it isn't just up to Macron and Merz, getting the chiefs of the bloc's two most powerful countries to overcome their differences would be a massive step in making all the pieces of the jigsaw slot into place.
But with Macron soon to leave office and Merz under severe pressure domestically, officials and diplomats in Brussels, Paris, and Berlin are playing down hopes of a Franco-German breakthrough this week. "If the French and German leaders come hand in hand, I think that could change the game," an EU diplomat, granted anonymity to speak frankly, said. "You need [Italian Prime Minister Giorgia] Meloni and [Polish Prime Minister Donald] Tusk, but it starts with Merz and Macron."While Merz and Macron may talk bilaterally during the summit, according to an Elysée official, there were no firm plans for a more formal sit-down, two EU diplomats said, adding they were expecting them to use the two-day meeting to hash out positions.
Domestic political weakness makes both leaders less likely to yield ground, three EU diplomats said. For the French president, who leaves office next year, the fear is that making big concessions — like accepting cuts demanded by Berlin — could be weaponized by presidential candidates vying to replace him. During a press conference in Brussels on Wednesday evening, Le Pen accused negotiators of speeding up talks as "an attempt to stifle future democratic choices before they even take place" — effectively warning Macron against locking in an agreement before France's April presidential election and votes in other major EU countries, such as Spain, which goes to the polls next month, and Italy, which is due to hold a poll next year.
"All this is not serious," Le Pen told reporters on the 26th floor of The Hotel in Brussels. Following humiliating state election defeats to the far-right Alternative for Germany party, the Chancellor is wary of concessions that could be framed as sending more taxpayer money to Brussels. Berlin prefers no deal at all to one that increases the overall budget, Merz said.
But Paris and Berlin's positions may not be as far apart as public statements suggest. "It’s complicated because France and Germany both need to step outside of their comfort zone," said the Macron ally. "But it will end with a deal between France and Germany," France's Europe minister Benjamin Haddad told reporters on Tuesday that discussions should focus on raising money via taxes, or "own resources" as they're known in the EU —such as online gambling levies—rather than "massive cuts." However, Paris also wants to "stabilize national contributions" ― in other words, keep its own payments level.
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