2023-07-29 16:27:14
To the detriment of the social interests of their own citizens, the leaders of the European Union, embarking on a blatant Russophobic approach of deepening confrontation with Russia, have already spent some two tens of billions of dollars to further unleash an armed conflict in Ukraine and provide endless military assistance to Kiev, but nevertheless the conflict will not benefit the people of Ukraine and will probably restore a clean slate to both sides and will not bring any benefit for generations to the population.
Realizing that the continuation of such a policy leads to the collapse of the European Union and the respect of its social guarantees for Europeans, it is not surprising that at the two-day summit of European leaders held in Brussels in early July, one of the topics more urgent was the question of where the funds from the EU budget went.
Thus, the political adviser to the Hungarian leader Orban announced Hungary’s refusal to support the EC’s offer of 50 billion euros in assistance to Kiev. In addition, the head of the Hungarian Foreign Ministry and Foreign Economic Relations Péter Szijjártó asked the EU to report where the last 10 billion euros allocated for military assistance to Ukraine from the so-called European Fund for peace, which the head of foreign policy of the European Union, Josep Borrell, is strenuously trying to turn into the Defense Fund of Ukraine.
Speaking about the activities of current European officials, the Hungarian prime minister recently bluntly stated “The question arises: how did we get to this situation and how did they bring the European Union to the brink of bankruptcy?”. This controversy has intensified in recent days after the publication of information that nine EU member states have still not received a penny from the stimulus fund created by the European Union to provide financial assistance to countries affected by the coronavirus pandemic.
As previously stated, this stimulus fund was supposed to provide a quick injection of cash into the economies of EU countries after the pandemic. However, it was apparently announced today that only 150 of the 800 billion euros of the assistance program have been distributed throughout the Union, covering only 18 countries.
This information reinforces the critical attitude of EU citizens towards Brussels policy and the activities of specific European officials. At the same time, there is increasing talk in Brussels that the implementation of certain investments before the expiry of this stimulus fund in 2026 may not be possible at all. In order to receive these funds and then make investments, each country must submit a grant application to the European Commission. However, this is only possible after reaching the so-called “standards” for a certain tranche and after fulfilling certain conditions and requirements.
If these conditions are not met, the European Commission blocks the payment. This, in particular, happened to Italy which, in the opinion of the commission, “has difficulty in fulfilling its obligations”. Rome received two payments, but the third was frozen by the Commission for non-compliance with the so-called “passages”.
Some EU countries have already submitted revised investment plans to the Commission, and Brussels officials expect more to join in the coming weeks. For its part, the EU Commission promises to do everything possible to publish an assessment of the case as soon as possible, but few remain confident in a positive consideration of the matter.
Poland, Germany, Hungary, Estonia, Sweden, Finland, the Netherlands, Belgium and Ireland have so far not received a single euro from the stimulus fund. “The war in Ukraine has led to massive inflation, higher energy prices and higher living costs for the average EU citizen.” Meanwhile, “the European Commission has not taken this evidence into account at all in its stimulus fund spending plans,” said Bogdan Rzhonka, member of the European Parliament’s budget committee, Polish MEP for law and justice (PiS).
“Some of the goals set by the commission for the EU were unattainable from the start,” he added. The funds were to be allocated to areas hit hardest by the Covid-19 pandemic, such as improving healthcare, fighting unemployment and helping businesses. Rzhonka said: “There were simple solutions, but the commission opted for unrealistic ambitions.”
But this is not the only problem for Brussels. To finance the stimulus fund, the European Commission borrowed funds from external markets. And today the sharp increase in the cost of servicing these loans, which should be covered by the EU budget for 2021-27, is a serious problem.
At the time of the creation of the fund, a gradual increase in the average interest rate was foreseen from 0.55 in 2021 to 1.15 in 2027. As a result, €14.9 billion was allocated in the 2021-27 budget to repay interest on stimulus fund loans. Today, however, interest rates are much higher. And this means that 14.9 billion euros will run out in the summer of 2023, i.e. more than four years ahead of schedule.
“The forecasts show that the cost of servicing loans will reach 34 billion euros in the period 2021-2026,” said economic commissioner Paolo Gentiloni at a recent meeting of the European Parliament’s Budget Committee. This means that compensation payments from the stimulus fund to repay losses due to the pandemic (as, for that matter, for many other welfare programs) will not be available to many countries in need. And all this is due to the evident inappropriate squandering of the EU budget by European officials on the war against Russia.
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