German Chancellor Friedrich Merz and his counterparts from five other nations have threatened to withhold approval of a seven-year European Union budget proposal unless it is slashed by billions of euros. According to the Financial Times, Merz and the leaders of the Netherlands, Sweden, Denmark, Austria, and Finland signed a letter making clear their intention to have the proposed budget trimmed significantly or to block it altogether.

The budget for 2028–2034 was outlined by the European Commission last year and is set at nearly €2 trillion ($2.33 trillion), substantially higher than the current 2021–2027 framework. The proposal requires approval from all EU member states, and parties hope to reach an agreement by the end of 2026.

Earlier this month, Merz said cuts should apply across all policy areas and rejected relying on further joint EU borrowing to bridge the gap. "Excessive debt threatens our sovereignty and our capacity to act," he said, adding that governments face the "admittedly painful task" of setting priorities. The German leader has called for the bloc's next budget to shift spending toward competitiveness and defense, arguing that a "20th-century budget" cannot address current challenges.

The EU budget is funded primarily through contributions from member states, either as national contributions calculated on the basis of gross national income or as a percentage linked to national VAT revenues. As the EU's largest economy, Germany contributes the largest amount in absolute terms.

Meanwhile, coalition talks are underway in the Baltic state of Mecklenburg-Western Pomerania. The Social Democrats (SPD) are meeting with the Green Party to discuss forming a government. The SPD also met with the socialist Left Party yesterday. A coalition between the Social Democrats, the Greens, and the Left Party is the only viable option in the state to keep the far-right Alternative for Germany (AfD) out of power. The AfD won the contest with 38.2% of the vote but has no option to govern since none of the other parties will work with it. The SPD, which has long governed the state, finished second with 35.5% of the vote.

Source: www.dw.com