Irish EU presidency floats budget compromise; Merz says no deal

Ireland, holding the rotating EU Council presidency, put forward a compromise proposal on Saturday aimed at breaking a deadlock in negotiations over the European Union's long-term budget. However, German Chancellor Friedrich Merz dismissed the proposal, stating publicly that he saw 'no basis for agreement' in the text as presented.

Points of contention

The EU's multi-year financial framework negotiations have been stalled over disagreements between member states on spending priorities, particularly on cohesion funds, agricultural support, and defence-related expenditure. Germany, as the bloc's largest net contributor, has pushed for budgetary discipline and limits on overall spending growth, while southern and eastern member states have advocated for maintaining or increasing transfers to their regions.

Ireland's role and next steps

Ireland's compromise text sought to bridge the gap between the austerity-minded northern states and those demanding higher transfers. Merz's rejection complicates the Irish presidency's timetable and will likely push substantive negotiations into the next presidency. European Commission officials indicated that further technical consultations are planned before a new draft is circulated.