European Union states remained deeply divided over the bloc's budget for 2007-2013 today and expressed doubts over a planned new growth fund.
Luxembourg, which holds the EU's rotating presidency, said that after a number of technical debates on the budget, member states would soon begin the final phase of talks to try to reach an agreement in June.
"Serious business will start in the next few weeks," Luxembourg Foreign Minister Mr Jean Asselborn told reporters during a meeting of the boc's 25 foreign ministers.
Diplomats said that six net payers, led by Germany and France, had stuck to their guns in efforts to cap spending at the current level of 1 per cent of gross national income (GNI), which would translate into €815 billion over seven years.
Some other member states sided with the proposal of the EU's executive Commission to set the budget at 1.14 per cent of GNI on average over the period, or some €930 billion.
Others, notably Finland and Estonia, argued for a budget of 1.1 per cent of GNI, diplomats said. "As is the tradition, the net payers raised the issue of keeping the budget at below 1 per cent of GNI," an EU diplomat said.
The Commission has warned that if the EU fails to agree on the budget before June, EU financial planning will be thrown into chaos, threatening the timely allocation of billions of euros in regional aid.
It argues that spending needs to grow to properly finance EU expansion last May, when 10 states, mostly ex-communist, joined. Spain, Greece and Portugal, which have so far received the bulk of EU aid, are afraid that a smaller budget would deprive them of funds in favour of poorer, ex-communist members.