Behind the scenes of the EU’s billions: there is said to be a compromise when everyone is equally unhappy

– This week’s event is the EVS, which ended on Tuesday morning with the agreement on the EU budget, the Multiannual Financial Perspective (MFP) and the Recovery Fund. For you, this is not the first EVS and not the first negotiation of the EU budget.

– 90 hours is only exceptional. This EVS was perhaps 25 minutes shorter than the longest EVS in history: the Nice meeting where contracts were negotiated. Perhaps the duration of this EVS was a consequence of Nice, where the way in which the Communities made decisions was established. As you know, in this EVS, we have been deciding for three days how decisions on reform plans and their implementation will be made, either unanimously or by a qualified majority.

Furthermore, for the first time in history, two parts of the money were decided simultaneously: the multi-annual financial perspective (more than 1% of the EU’s GDP) and the other part, the Recovery Plan for the COVID-19 crisis, which it is more than half of the first part. . These are two huge blocks.

On the one hand, when you have a lot of money, it may be easier to divide it, but on the other hand, when you have a lot of money, it is more difficult to agree on the rules on how to spend it.

So, I think the uniqueness of this EVS was related to its duration and amount of money.

– Lithuania came to EVS with 4 main requirements: increase (at least not decrease) cohesion, increase direct EU payments to farmers, closure of the Ignalina nuclear power plant and financing of the Kaliningrad transit. And for the most part, everything was accomplished except an increase in funds for the closure of Ignalina. How it worked What tactics did the Lithuanian delegation use?

– Yesterday, during one of the meetings, the ambassador of the German EU Presidency admitted that he personally did not believe that he would win the increase in direct payments to the Baltic States. I think that answers a lot of questions about what the atmosphere was like.

Negotiation is not something everyone has a desire for. Rather, there are offensive and defensive interests. T. and. We may want to unify direct payments, but there are member countries that oppose it. Then two completely opposite interests intersect and the presidency, EVS President Charles Michel, has to resolve the dispute.

– Is this how the solution was reached?

– It is said that a compromise is reached when everyone is equally unhappy …

– But after this EVS, do all countries claim to have won?

– (Laughter – ed.) … Or everyone is a little happy. If we look at the negotiating document, we will see that the Baltic States have not obtained everything they wanted, but the situation has improved. When it comes to direct payments, the situation has never been as good as now.

Attempts have been made to find a common formula, but if this severely distorts the situation in one country or another, then ways are sought to alleviate that situation.

There are also rules that we know about. Suppose that the more the economy grows, the less cohesion falls. If there had been a pure formula for Cohesion Funds in the negotiations, Cohesion would have been reduced by 45% instead of 22%. So sometimes we trade not for bigger money, but for smaller haircuts.

In Ignalina and Kaliningrad, I believe that our negotiating tactics were correct, because we said that these were the legal obligations of the EU. Our goal in joining the EU was neither the Kaliningrad transit nor the closure of Ignalina. Those things are mentioned in the protocols of our accession treaty.

In the case of Ignalina, it is written that “adequate” financing must be guaranteed. So the question in the negotiations is: what does “adequate” mean? And in the case of the Kaliningrad transit, it is written that “it must work”, and how it “will work” and how it will be financed is already the subject of an agreement.

It cannot be said that we have accomplished nothing at Ignalina – let’s compare how much money has been allocated in the past and in this financial perspective – it is more money (EUR 459 million and EUR 490 million – ed.) It should also be noted that The report The Court of Auditors concludes that a significant increase in national co-financing is necessary, with a gradual transition to a Member State. However, we have come up with a different solution: national co-financing of only 14%. (unlike Slovaks and Bulgarians, who are also shutting down their nuclear power plants).

As for Kaliningrad, it is gratifying that that number has increased at least a little in the last days of the negotiations.

Sure, we can say we could have done better, but do you remember where we started the negotiations? And since one of the largest taxpayers has left the EU. The MFP is declining not so much because of the economic downturn, not even because other donors have become very frugal, but because we have lost the third largest payor, the UK. Therefore, it is natural that the EU budget has been reduced.

– As for behind the scenes of EVS. Even before the start of the EU leaders’ meeting, hopes for many to reach a consensus turned to German Chancellor Angela Merkel. Lithuanian President Gitanas Nausėda even gave him a driver’s wand. Which politician played the most important role in the negotiations and determined that an agreement was reached after almost 90 hours?

– The last stage of the negotiations was in the hands of the president of the EVS. Ch. Michel struggled to achieve the best result for those 90 hours. It cannot be said that such an agreement would be possible without it. However, it is clear that the leaders of the main states, particularly Germany and France, have been heavily involved in this harmonization.

Clearly, the driver’s wand is very symbolic. It was a beautiful gift and it is clear that Merkel is one of the leaders of the EU, who not only understands the political situation and feels personal responsibility, but at the same time knows perfectly well what she is doing herself. She knows the numbers, the situation in each country. She is probably the best informed negotiator. But keep in mind that for three days we are not talking about numbers, but principles.

– Another question about behind the scenes. After EVS, the Presidency posted a photo of President G. Nausėda playing chess. Have you had the opportunity to play chess with the President?

– (Laughter – ed. Paste) No, I don’t play chess … I make sure there is a chess board.

– Whats Next? The European Parliament is now involved, and the parliaments of the member states must ratify the agreement … Or, to put it simply, when will the agreed EU money arrive in Lithuania?

– The money will probably be in the second quarter of next year, if all decisions are made on time. In particular, Lithuania can already start negotiations on a reform program to invest money from the Economic Recovery and Resilience Fund and other related funds. It is hoped that the coordination of these programs with the European Commission will not take long. As you know, the discussion took a long time about the approval of these plans and it was decided that there would be an ordinary legislative procedure, i. and. Qualified majority of the parties, but if a member state sees that some interests are not being met, then it can resort to EVS.

So here is a role that a member state has to play, in this case Lithuania. There are other parts: for the MFF and the entire package to have a legal basis, an agreement must be reached with the European Parliament, which must give its consent. It is not so simple. We are already hearing critical voices, because the European Parliament had more objectives: it wanted “greening”, digitization, a larger MFP in itself (on some issues, Lithuania’s opinion was similar, but a compromise was reached when not everyone is very happy).

The third part will include national parliaments. This is the so-called own resources problem, i. and. decisions on contributions to the EU budget, which must be ratified by national parliaments. The issue of own resources creates the legal preconditions for EU loans. As you know, 750 billion. The EU intends to borrow and repay loans by 2058. The ratification process generally takes up to two years (because in some countries there is more than one parliament), but in the present case, the decision is retroactive. This means that even if all national parliaments ratify 2021 by the middle of the year, it will start to raise money from member countries starting in 2020. January 1 Such a decision could take even longer, yes, it can, because some countries imagine that the budget is too large or conditions are too easy.

– This EVS also marks the end of his five-year term in Brussels. The EU is considered by many to be very slow, bureaucratic and boring. Was it really boring?

– Certainly not. I would say that this is one of the most boring jobs in the entire diplomatic service, because the jobs are from A to Z. T. and. The issues that had to be considered and discussed are very broad: from migration to agriculture, from the budget to state aid for the poultry industry, from the consequences of the drought in Lithuania to cultural events. This is a wide variety of questions. The longer you are, the more interesting things seem, the more adrenaline.

Of course, it’s important not to empathize sometimes, not to underestimate the coma you’re struggling for two days as an essential result of your work.

The EU is a two-way street. Some say the EU is slow, inefficient, boring, while others say that everything needs to be clarified more, more and more participants in the debate. If we want openness, participation, consultation, the process will in no way be faster. Democracy is always slow.

Interestingly, more recently, they have all missed the EU: the coronavirus wall has closed, there is no EU solution. So how is the EU doing nothing here? Suddenly everyone realized that perhaps it was good to have a common solution, although in this particular case, border closure and border control is a national competence whose member states, including us, Lithuania, never wanted to hand over to the European Union. But when a crisis arises, the EU seems to need to step in and we want that solution, even if that solution takes a long time.

And I generally say to myself that we just have to look aside, to our neighbors and ask ourselves: do we want solutions as fast and boring as in Russia or Belarus? If so, then the election is not transparency, not democracy, not inclusion.

– What would be the basic work rule in the so-called Brussels bubble?

– There is no single rule. There are many different situations and rules. Sometimes it seems that the best solution in a very controversial discussion is silence. And sometimes the best solution is to stay still, even if you are told that you are left alone and that you are slowing down the process or not like the others. Much depends on the specific situation.

In addition, knowledge of EU standards, EU legislation is very important. But on the other hand, knowing that the rules are flexible and can be interpreted is no less important.

Institutional experience is probably a unique thing in Brussels. They have worked with Brussels in the past, you have been to Brussels before, and that is much appreciated. On the other hand, it puts a certain stamp and when a creative solution is needed in a difficult situation, it is more difficult for those people who come from the institutions.

After all, I would say that personal contact is very important: whether it be people in institutions, whether they are civil servants, whether they are experts, journalists, or whether they are Lithuanian in institutions. Probably half of what I did wouldn’t have been done if it hadn’t been for personal contacts. Networking of people is very important.

– What was the biggest challenge working here in five years? Brexitas, negotiations on the EU budget …

– I would look at it from the other side and say that the greatest challenge for any ambassador is to be listened to when there is a critical situation or a problem that is particularly important for foreign policy, national security. It is very important that we are listened to and that our position is understood. By resisting that, we can hope for the best solution.

The EU is made up of 27 member states, and it is probably impossible to expect a one hundred percent solution of what we want in any area.

But more importantly, I think hitting higher than your weight class allows.

– How would you name the relationship of Lithuanian society with Brussels?

– Lithuanians are one of the largest Europhiles in the EU. Another two thirds of Lithuanian citizens remember what it was like when we did not belong to the EU. I remember standing on the Lithuanian-Polish border for 12 hours. I remember when I needed a visa to fly to the UK. I remember when I traveled to France and I had to change the currency to francs, and then something happened in France and we had to move to Belgium to exchange money for other francs again. I remember sitting at the shaggy school because it was just a non-renovated building with hollow windows. I think most people remember Lithuania as such.

The EU is also a source of economic growth for us. It is also an incentive for reform.

And, of course, money.

– And what is the EU’s biggest challenge for Lithuania?

– In formal and informal talks in Lithuania, I always say that our aim is to hold on to the EU and the euro area. It is not just the economy, it is our security. In the face of major crises in, for example, Greece and the euro area, Brexito and Ireland, we must become an integral part of the EU to make our separation from these institutions (for imaginary and unimaginable reasons) incomprehensible, impossible or even possible, but then so heavy and expensive that no one would want to do that.

This does not mean that we must now become the greatest federalists, we must say that we need to create a united union of European states, it will not happen. But our network, our integration into what already exists, must be so deep that there is no going back. So the challenge is that we haven’t done everything yet.

– The most influential publication in the Brussels bubble. politico.eu You were recently called an oracle. So what future for the EU do you see? Where is the EU going, also in view of the planned conference on the future of Europe?

– The Brexit referendum was followed by a long process in which much was said about what the EU needed. According to Brexit, one of the reasons was that there was no discussion about where the EU is heading and what the final or intermediate objective is. At the initiative of the European Commission, 5 scenarios have been developed on what the EU should be like: from devolving some of the powers to the Member States to having to integrate everywhere and in all sectors.

Regarding the first scenario, a special working group was created and an attempt was made to ask the Member States what competencies they would like to recover. Answer: none.

Another scenario is full integration. But when asked how to integrate everything, even the greatest federalists couldn’t answer in which area more integration is needed.

So there are no ends in shape. I like to say that the truth is not beyond, the truth is in the middle, at least in the EU, in Brussels. If any non-integrated areas remain, it is probably because there has not yet been a crisis in that area. When there is a crisis and a joint solution is needed, we will find that solution.

For example, the integration of external borders only started during the migration crisis. I remember the debate as soon as I got to Brussels: I was asked if it would be normal for a German border guard to come to protect the Lithuanian border. I replied that I saw no problem with that, because at the same time, decisions were being made about NATO’s front-line battalions.

So I think integration will deepen and deepen in areas where joint action is needed.