The 2009 EU budget and the Crisis

The EU budget is being discussed at a time of rising anxiety regarding the economic crisis which is engulfing its member states. This crisis prompts the Commission, the Council and the European Parliament to think on how the EU budget resources can combat the economic downturn.

A considerably speedier disbursement of structural funds in the New Member States (NMS) is a must under the new conditions, and the Commission´ s intention to simplify procedures in this respect is more than welcome. But this intention has to turn into concrete deeds and the EU budget has to be ready in case additional payment appropriations are needed --as the report correctly highlight. By the away: this event hinges on the very simplification of procedures.

For the non-eurozone NMS the leeway for using a budget stimulus out of own resources is much reduced because of this financial crisis; and the credit crunch is likely to prevail on international markets in 2009. Therefore, EU funds and other forms of EU assistance, within the framework of what I would call "credit enhancement", are badly needed in order to fight a severe economic slowdown in the NMSs.

Donor countries might relish lower payments of EU structural funds by eying their reorientation to other uses. But let´s not cheat ourselves. If NMSs get injured by this crisis more than what their intrinsic weaknesses warrant the effects would be bad for the Union as a whole.