Iohannis, Michel discuss future EU budget, economic recovery plan in videoconference

On Tuesday, President Klaus Iohannis held a bilateral videoconference consultation with the President of the European Council, Charles Michel, in preparation for the European Council meeting of July 17-18 in Brussels.

According to the Presidential Administration, discussions focused on the future 2021-2027 multiannual budget of the European Union and the European Economic Recovery Plan proposed by the European Commission.

Iohannis presented the main objectives that Romania has in this negotiation process, reiterating the need to reach a final agreement as soon as possible.

The Presidential Administration indicates that regarding the future budget of the European Union, the Romanian chief of state underlined that the major objective of Romania is to obtain the highest possible allocations for cohesion and agriculture policies.

"President Klaus Iohannis reiterated his call for the two main policies to be maintained in the future budget of the union, given that they are the most important and well-functioning investment instruments of the Union that operate adequately and that can offer efficient solutions in crisis situations," the Presidential Administration showed.

With regard to the cohesion policy, Iohannis called for greater flexibility in absorbing the money allocated to the policy. He advocated for increasing transfers between the various funds of this policy to adapt the available funding to specific development needs. Iohannis also spoke in favour of maintaining the co-financing and pre-financing rates for the current 2014-2020 programming period, as well as the current disengagement rule for European funds of n+3 years.

Iohannis also called for additional flexibility in the focus on the European Regional Development Fund.

He also requested, regarding the Common Agricultural Policy, additional allocations for rural development, taking into account the fact that rural areas have a high need for long-term investment.

With regard to direct payments, he underlined the continuation of their external convergence process, so that the amounts granted to Romanian farmers in the union budget would be as close as possible to those in Western European countries. Iohannis has opted to eliminate the binding nature of the direct payment capping mechanism, so that member states have the necessary flexibility to adapt funding to their specific conditions.

"Regarding the introduction of new own resources to the budget of the European Union, President Klaus Iohannis stressed that Romania is in favour of any other resource that can generate additional revenue but which does not affect existing sources of income in the member states," the Presidential Administration mentions.

Regarding the European Economic Recovery Plan, Iohannis mentioned a substantial total allocation for a higher share of the grant component compared with the loans in the total amounts allocated, as well as a quick and efficient access to finance for all member states. Iohannis also called for as long a period as possible for the implementation of the new economic recovery instrument, so that the amounts allocated to the member states could be fully and efficiently absorbed.

"The President of Romania has called for a 30-year repayment period for the funds allocated for economic recovery, as such approach would allow the implementation of medium and long-term commitments made at the European Union level, while avoiding undue pressure on the European Union national budgets," the source says.

About the Just Transition Fund, Iohannis called for the voluntary nature of transfers from the Cohesion Fund to this fund.