EU budget summit ends without deal, retry in 2013

Fri Nov 23, 2012 11:53am EST
 

By Charlie Dunmore and Luke Baker

BRUSSELS (Reuters) - European Union leaders failed to reach agreement on Friday on a new seven-year budget for their troubled bloc, calling off talks in less than two days after most countries balked at far deeper spending cuts demanded by Britain and its allies.

European Council President Herman Van Rompuy said they decided to end a special summit on the 2014-2020 EU budget, worth about 1 trillion euros, and would try again early next year rather than continue negotiating into the weekend.

"The bilateral talks yesterday and the constructive discussion within the European Council show a sufficient degree of potential convergence to make an agreement possible in the beginning of next year. We should be able to bridge existing divergences," Van Rompuy told a news conference.

"My feeling is that we can go further (in cuts) but it has to be balanced and well prepared, not in the mood of improvisation, because we are touching on jobs, we are touching upon sensitive issues," he said.

The leaders mandated Van Rompuy and European Commission President Jose Manuel Barroso to try to close the gaps between member states in the coming weeks. Officials said the most likely date for resuming the talks was February.

Chancellor Angela Merkel of Germany, the biggest contributor to EU coffers, said she had not expected a deal at the first attempt and played down the consequences of failure, saying there was a real potential for agreement at the start of 2013.

"I have always said that it wouldn't be dramatic if today were only the first step," she told reporters.

The last time the EU held its marathon budget negotiations in 2005, it took six months and an acrimonious failed summit at which Britain wielded its veto before a deal was finally found.   Continued...

 
French President Francois Hollande (R) takes his seat before a meeting with British Prime Minister David Cameron (L) and Dutch Prime Minister Mark Rutte (2nd L) at the EU council headquarters in Brussels, November 23, 2012, as part of a two-day European Union leaders summit. REUTERS/Bertrand Langlois/Pool