With the sword of pre-election fever in several European countries hanging over the measures for energy prices and the negotiations for the new EU budget, the Summit ended yesterday without tangible results.
Thursday's all-night thriller did not lead to fiscal relaxations or the return of additional state VAT revenues to economies and households. What was achieved in the early hours of Friday and included in the text of the Council's Conclusions was to recognize the problem created for businesses and households by the war in the Middle East and the need to take measures.As can be seen from the Conclusions of the Summit, the "27" agreed on the need for a coordinated European response to high prices, with targeted measures, taking into account the specific circumstances of the states.
At the same time, the leaders called on the European Commission "to examine and propose, if necessary, further measures to address the ever-increasing prices, taking into account the differences in electricity prices between states".
In the grid of marathon negotiations, the extension of state aid for the most affected industrial sectors was achieved, while the Commission's proposal to postpone the methane control regulations, which aim to force fossil fuel importers to prove that their suppliers record methane emissions, which are harmful to the environment, was welcomed. Their implementation is postponed to 2028, following intense pressure from the US, France, Italy and the Czech Republic.
A hole in the water for pollutants
The pressure to suspend the existing Emissions Trading System (ETS) has been scattered in the wind. The "27" limited themselves to calls to contain fluctuations in the prices of pollutants, which burden the cost of electricity production and by extension the bills of consumers. They asked the Commission to limit large price fluctuations, but without touching on the basic charging mechanism.
The pressures for a new postponement of ETS2, which introduces charges for emissions from vehicle fuels and heating of buildings, were also fruitless. Cyprus has been in favour of its suspension, joining countries that warn of additional burdens on households.
The background was explosive. Italy, Poland, the Czech Republic, Slovakia and Hungary pushed for a postponement of the implementation of ETS2 until 2030, meeting resistance from Germany, France and Spain. Cyprus and Greece also participated in the wider front in favour of the postponement.
The compromise reached was limited to a mandate to the Commission to review the implications and safeguards of the new system.
In essence, no suspension of existing charges or a new postponement of ETS2 was decided, and households did not secure any immediate relief.
Budget wreck
The leaders' negotiations on the hot issue of the new EU budget for the seven-year period 2028-2034 have reached an impasse. The intense disagreements between the two camps (Parsimonious Vs Friends of Cohesion) that have formed, did not allow an agreement to be reached even on the basics.
In the face of the impasse and in order to leave a window open for the continuation of negotiations, the "27" limited themselves to discussing key parameters on the basis of the revised negotiating framework (Nego-box) of the Irish presidency.
The European Council instructed its president, Antonio Costa, to continue negotiations, with the aim of reaching an agreement by the end of the year.
The states are located in the two straits, as on the one hand they maintain strong disagreements, and on the other hand after December it is considered extremely difficult if not impossible to find a political agreement under the weight of the elections in Spain, France, Greece and Italy.
Emmanuel Macron's call for an agreement before January was dramatic yesterday in the closed session of the Council, according to information from "Le Mond". "There will be no political room after that," he reportedly told his European counterparts.
Quarrel over cuts
The gap, however, remains unbridgeable, while during the night before yesterday, there were also moments of tension. According to diplomatic information from Politico, German Chancellor Friedrich Merz highlighted the Cohesion funds as a possible source of additional cuts, provoking reactions from the opposing camp. Sánchez and Meloni appeared opposed to further spending cuts. The focus of the search for a compromise is now also on the new European sources of revenue, in order to limit the burden on national budgets.
The Cypriot proposal
President Christodoulides gave a new dimension to the negotiations, proposing a shorter budget of three or four years, instead of seven. The proposal conflicts, however, with the European Treaties, which provide for a minimum duration of five years. Mr. Christodoulides, however, estimates that the final cuts may reach 10%-11% of the Commission's initial proposal.
New appointment with thorns
With all the thorny issues open, Antonio Costa is called upon to look for the golden mean, ahead of the next round of negotiations in November. The big bet is to bridge the gap between the "Thrifty" and the "Friends of Cohesion", both in terms of the amount of the budget and the allocation of funds.
The task becomes even more difficult, as the countries that call for spending restraint simultaneously seek greater funding for defense and competitiveness, while the opposing camp insists on the protection of agriculture and Cohesion.
The EU's new own resources are back on the table, with Costa asking the Commission for additional proposals, including the taxation of digital services.
The time frames, however, are running out, since without a political agreement by the end of the year, the approval of the necessary legislation in 2027 and by extension the unhindered flow of European funds from January 2028 is in danger of being delayed.
