Emmanuel Macron wanted a big pot of cash known as the Budgetary Instrument for Convergence and Competitiveness (BICC) to support reforms in eurozone countries and ultimately help absorb sudden economic shocks to the single currency. But non-euro countries Sweden and Denmark cried foul and won the support of allies such as Ireland and the Netherlands to push back the French president’s grand integrationist scheme in a closed-door meeting before the formal talks in the Eurogroup.
The Nordic countries now look set to win some form of compensation to ensure they never have to pay into programs that only benefit eurozone member states.
It is unclear how the compensation will work but Eurogroup President Mário Centeno promised the Scandinavians it would happen.
Mr Centeno said: “We saw a huge sense of compromise among ministers so I don’t think that anyone is detrimental to anything that we agree upon in the Eurogroup.
“Those decisions are very, very important, and very, very important decisions take a long, long time to take.”
But critics of the French president who oppose the eurozone budget were less diplomatic.
German conservative MEP Markus Ferber said: “Finance ministers have trimmed down Emmanuel Macron’s megalomaniac ideas for a eurozone budget back to a realistic size.
“After all, the new instrument is not meant to finance social spending of member states.”
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“But I’ve been equally sympathetic to Sweden and Denmark, who have vocalised that if they’re not going to take part in it, then also they shouldn’t receive a bill.
“Both asks to the group of countries deciding on the budget are just and fair.”
Ministers had gathered in Luxembourg to agree on the 19-nation BICC before leaders sit down to final talks this month over the budget for all 27 EU countries.
The euro instrument will be a component of the Europe-wide Multiannual Financial Framework for the years 2021 to 2027.