In his eagerly awaited report on the future of the EU\u2019s competitiveness, former European Central Bank President Draghi stated on September 9, Monday, that the EU should continue to build on the model of its \u20ac806.9 billion pandemic recovery plan, provided that “political and institutional conditions” are met.<\/p>\n
The NextGenerationEU (NextGenEU) program provides grants and loans to member countries for critical investments in exchange for targeted reforms, financed by jointly undertaken debts by EU member states.<\/p>\n
Historically fiscally \u201cconservative\u201d EU countries, including the Netherlands and Germany, strongly oppose the renewal of NextGenEU beyond its August 2026 deadline.<\/p>\n
FDP\u2019s concerns: \u201cBureaucracy and planned economy\u201d<\/p>\n
Christian Lindner, leader of the liberal FDP and German Finance Minister, wrote on X on Monday that \u201cthe EU\u2019s joint borrowing will not solve structural problems: companies are not lacking subsidies. They are tied up by bureaucracy and a planned economy. And they struggle to access private capital. We need to work on that.\u201d<\/p>\n
Lindner\u2019s assessment stands in sharp contrast to that of Green Party\u2019s Vice Chancellor and Minister of Economic Affairs Robert Habeck, who described Draghi\u2019s report as \u201ca call to action for the new European Commission and the EU as a whole.\u201d<\/p>\n
Greens support Draghi<\/strong><\/p>\n Habeck said, \u201cI am happy to pledge support for the [report\u2019s proposals]. Innovation, better framework conditions, and mobilizing public and private sector investments are the order of the day.\u201d<\/p>\n The differing views among ministers emerged amid ongoing budget disagreements within Chancellor Olaf Scholz\u2019s federal coalition government in Germany.<\/p>\n Known as a \u201cfiscal hawk,\u201d Lindner has repeatedly called for deep cuts in public spending to comply with Germany\u2019s constitutionally mandated debt brake. These calls have been resisted by the Greens and the SDP.<\/p>\n Netherlands: More money is not always the solution<\/strong><\/p>\n Draghi\u2019s report received a uniformly negative response from members of the Netherlands’ four-party coalition government, which includes far-right factions.<\/p>\n According to Dutch news agency ANP, Eelco Heinen, a well-known \u201cfiscal hawk\u201d and member of the conservative People\u2019s Party for Freedom and Democracy, said, \u201cMore money is not always the solution.\u201d<\/p>\n A similar assessment came from Dirk Beljaarts of Geert Wilders\u2019 right-wing Freedom Party (PVV). Beljaarts stated, \u201cAdditional public investments are not an end in themselves. They are only necessary in cases of unfair competition or market failure.\u201d<\/p>\n Objections from EU diplomats<\/strong><\/p>\n Criticisms of Draghi\u2019s call for a significant increase in EU-level investments have also been echoed by some EU diplomats.<\/p>\n An EU diplomat speaking to Euractiv referred to the bloc\u2019s Multiannual Financial Framework (MFF) or \u201cregular\u201d budget, stating, \u201cThe discussion on more EU investment will be part of the next MFF debate.\u201d<\/p>\n The bloc\u2019s current seven-year \u20ac1.2 trillion MFF will end in 2027.<\/p>\n Southern countries support the report: Support from Spain and France<\/p>\n On the other hand, Draghi\u2019s proposals have received support from some key member states.<\/p>\n Bernard Guetta, a member of French President Emmanuel Macron\u2019s Renaissance party, praised the report\u2019s call for \u201ccommon defense, industrial policy, and abandoning the taboos of joint debt.\u201d<\/p>\n Speaking to Euractiv, Guetta said, \u201cIt is absolutely necessary to urge member states, the European Parliament, and the future Commission to fully embrace the idea of industrial policies and joint investments.\u201d<\/p>\n Guetta also called on member states like Germany and the Netherlands to \u201copen their eyes and end their ideologies\u201d regarding joint borrowing.<\/p>\n The deputy acknowledged that France, which was officially \u201creprimanded\u201d by the European Commission earlier this year for high public spending, might not be the most reliable country to advocate for EU joint financing due to its own public finances being in the red.<\/p>\n Guetta\u2019s support for Draghi\u2019s key proposals was echoed by Spain\u2019s Finance Minister Carlos Cuerpo, who, like Draghi, believes that some of the necessary financing must come at the EU level. Cuerpo shared the need for urgent work on a permanent EU joint debt program.<\/p>\n Opposition in Italy: Lega and Five Star Movement against Draghi\u2019s proposals<\/strong><\/p>\n In Italy, while opposition from the Democratic Party and right-wing coalition members Forza Italia and Brothers of Italy generally agree that Draghi\u2019s proposals are a \u201cstep in the right direction,\u201d the coalition\u2019s small partner Lega and the opposition populist Five Star Movement disagree.<\/p>\n Lega Senator Claudio Borghi stated on X that every line of the report poses a \u201cdeadly threat\u201d to Italy, accusing Draghi of wanting to turn Italy into \u201cthe next Greece for revenge.\u201d<\/p>\n Pasquale Tridico, head of the Five Star Movement delegation in the European Parliament, directly targeted Draghi. Tridico argued that Draghi\u2019s report represents a form of self-criticism for \u201ccondemning the neoliberal policies that underpin the current European structure\u201d and questioned Draghi\u2019s role in key EU decisions, particularly regarding the Stability Pact reforms which Draghi now supports but which Tridico argues are inconsistent with the large-scale investments in innovation and green transition.<\/p>\n","protected":false},"excerpt":{"rendered":" Mario Draghi\u2019s call for the EU to continue issuing joint bonds to finance key investments has deepened the divisions within Germany’s already fragmented coalition government and received strong criticism from the Netherlands. In his eagerly awaited report on the future of the EU\u2019s competitiveness, former European Central Bank President Draghi stated on September 9, Monday, […]<\/p>\n","protected":false},"author":1,"featured_media":5360,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"ep_exclude_from_search":false,"footnotes":""},"categories":[3],"tags":[2934,891,805,2935,543,503,841,2068,2933,1881,2936],"class_list":["post-5359","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-europe","tag-draghis-report","tag-europe","tag-european-union","tag-five-star-movement","tag-germany","tag-headline","tag-italy","tag-lega","tag-mario-draghi","tag-netherlands","tag-nextgenerationeu"],"yoast_head":"\n