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Adrienne Warren

Estonia And The New EU Budget: “Theoretical Dreams Becoming Real Possibility”

The European Union’s leaders at the European Council meeting, which ended on Monday, reached an agreement on the budget for the next seven years (2014-2020), with the volume close to 960 billion euros, or 1 per cent of the EU’s gross national product (GNP). According to the new budgetary framework, Estonia will receive a share totalling 5.89 billion euros, which makes the country one of the greatest net beneficiaries of all the Member States.

Tallinn Blue Hour, author: mariusz kluzniak, source: Flickr

Tallinn Blue Hour, author: mariusz kluzniak, source: Flickr

There are usually several net contributors – 5-6 member states – and a number of recipients – 6-7 major member states. Five EU states –Germany, France, the UK, the Netherlands and Finland (and in the previous budget cycle-Italy) represent about 60 per cent of the EU financing and 2/3 of the net balances. On a yearly basis, Germany is the greatest contributor, followed by France.

All three Baltic States have been  permanent “receivers” since they joined the EU in 2004–joining 6 other countries who receive contributions from the Union.

The new budget framework is the result of more than two years debate, and the February summit was the second attempt to reach an agreement after  a summit in November 2012 ended in failure. The EU member states which favored austerity, namely the UK and Germany won over the “spending states”, ultimately reaching a budget of EUR 960 billion in forecasted EU expenditures for the next seven years. The new budgetary deal for 2014-2020 marks the first time in EU history that the long-term budget was not increased, however, in spite of such restrictions, the Baltic has avoided any truly negative repercussions.

Estonian Prime Minister Andrus Ansip explained after the talks concluded saying, “In spite of the contraction of the total budget volume, Estonia can consider itself a clear winner in these talks.” Under the new budget framework, Estonia’s share will be nearly 907 million euros more than it was in the 2007-2013 budget–allowing for the development of projects which had remained in the pipeline in previous years–including the Rail Baltic project. The proposed Rail Baltica would serve to link Tallinn with Poland and Germany via Latvia and Lithuania, with a nearly 730-kilometre-long railway.

“Thanks to today’s agreement, Rail Baltic is no longer just a theoretical dream but a real possibility,” Ansip enthused.

The new agreement brings good news for Estonia, and the region, heralding a coming 7 years full of potential progress, and coinciding with Estonia being named 31st of out 50 of “The World’s Most Innovative Countries” by Bloomberg’s Innovation Index. How such innovation will manifest itself in the coming years remains to be seen.

Sources: The Baltic Course, Bloomberg

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Graduated in International Relations and Russian. Resident of Estonia, but a citizen of the world. Most interested in contributing to the progress and education of mankind--as the primary tool of achieving global unity.

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