A huge new EU competitiveness fund?

Euractiv

5 days ago

It's B-Day! The European Commission will today unveil its seven-year spending plan, the so-called MFF. No, it doesn't stand for 'mutha-fuckin farmers' – though farm lobbies will be protesting in the streets of Brussels this afternoon. We got a glimpse of some numbers circulating late last night, suggesting that the total budget could be €1.7 trillion. A watershed moment, if it becomes reality!
Today we are covering every centime on our live blog here.
Welcome to the Capitals by Eddy Wax, with Nicoletta Ionta. Sign up here. Feedback is welcomed by email and do forward us to a friend or colleague.
Also in today's issue: Scoop: Macron's MEPs change leader after infighting
Spain and Ireland's drive to slap Israel with sanctions hits a wall
Four Irish MEPs secured a meeting on Gaza with VDL
Keffiyeh chaos in Parliament In the capital
Now it all comes down to the cold, hard numbers. After interminable debates about the structure of the new EU budget and meetings late into the night in the Berlaymont, all eyes are on its final proposed size.
When Ursula von der Leyen rings her little bell at the start of the commissioners' meeting this morning, many of them will be looking around the room with either schadenfreude or envy. Has his or her budget been cut more than mine? Are my funds ringfenced, or reduced with a sleight of hand?
Piotr Serafin, the EU's budget chief (von der Leyen is the real budget chief, of course) will brief MEPs at 12:30pm, before the grand unveiling to the media and the world this afternoon.
Is French Commissioner Stéphane Séjourné about to emerge as the big winner from the politicking over recent months? Peut-être. A document floating around last night purported to show that the budget would include a massive €522 billion for a new fund focused on boosting economic competitiveness. A huge competitiveness vault would suggest a major win for Séjourné, the industrial strategy chief. Read more.
The €522 billion would be split between a research programme, currently at €96 billion, but expecting a boost, and various smaller programmes not likely surpassing €50 billion. That leaves room for a possible European Competitiveness Fund of over €300 billion, unheard of on the EU level, my colleague Jacob Wulff Wold tells me.
The total size of the budget, according to the document – which may well have changed overnight – would increase to €1.717 trillion, but don't forget that the EU will also have to pay around €30 billion a year just to service its debt on the pandemic recovery fund loans.
Let's see if these numbers survive contact with reality today.
Von der Leyen's budget is a revolution in terms of its structure. Spare a prayer for regional authorities who are set to lose any direct role in shaping how billions of euros of cohesion funds are spent on improving struggling parts of the EU, writes my colleague Nikolaus J. Kurmayer in this must-read.
What are they smoking? The European Commission is also planning to raise new funds by taxing e-cigarettes, Sarantis Michalopoulos exclusively reports.
EU ponders Israel
EU foreign ministers will go through their options about how to rework their relationship with Israel to pressure it to end the war in Gaza today. Some diplomats thought the Gaza aid deal struck by the EU's top diplomat Kaja Kallas last week would diffuse today's talks. But the humanitarian situation in Gaza suggests otherwise.
"We do not see enough improvement on the ground. We need to really see that this, all this – what we have agreed – is also happening,' Kallas told reporters, including our own Alexandra Brzozowski last night. An EU diplomat said that while 'aid access has gotten better since the deal last week, distribution still remains difficult and of course the aid deal falls short of any full ceasefire."
Yet, ministers will remain deeply divided on whether to take measures against Israel, which means no substantive action is expected. The bitter, if familiar reality for Europe, is that trajectory of Israel's war on Hamas will be decided in Jerusalem and Washington.
Nonetheless, EU officials took solace in the fact that Israeli and Palestinian ministers came to Brussels for the EU-Southern neighbourhood ministerial dinner last night, the first time since the war in Gaza started.
French reshuffle in Parliament
Scooplet: French MEP Marie-Pierre Vedrenne is stepping down as the leader of the delegation of Macron MEPs, after a bust-up with her Renew Europe group leader Valérie Hayer. French journalist Emmanuel Berretta reported in a recent article in Le Point that Vedrenne had challenged Hayer's leadership of Renew, saying the group should stop whining about its diminished size after last year's election.
In the same article Hayer pushed back, saying Vedrenne should also take some responsibility as delegation leader. Vedrenne confirmed she's now stepped down. Laurence Farreng will take over the role, we hear. It was a 'very personal conflict based on differences in political strategy,' a French source in Parliament told us.
Gaza, Brussels
EU foreign ministers gathered on Tuesday for their first meeting since the bloc's top diplomat, Kaja Kallas, presented a list last week of ten potential measures championed by Spain, Ireland and Slovenia against Israel over its continued offensive in Gaza. But in the wake of Israel's recent agreement to ramp up humanitarian aid deliveries into region, a majority of countries abandoned the idea. Countries like the Netherlands that pushed Kallas to go further and review the EU-Israel association agreement gave up pushing further.
More Irish-Israeli action
Irish Fianna Fáil MEPs held a forty-minute meeting with Ursula von der Leyen, her chief of staff Björn Seibert and other cabinet members on the top floor of the Berlaymont yesterday, seeking to pressure her to end the EU-Israel Association Agreement or, failing that, restrict trade with Israel. Irish-Israeli relations have deteriorated severely since the beginning of the war, with Israel shuttering its embassy in Dublin last year citing the country's 'extreme anti‑Israel policies".
The Renew Europe four said they had nothing personally against von der Leyen, but abhorred the Commission's position on Gaza, where they claim Israel has breached international law following the deadliest attack on Jews since the Holocaust. Von der Leyen listened as they told her that her public statements should make more references to international law and the so-called two-state solution.
The MEPs secured the meeting ahead of the motion of censure against the Commission last week, where they were threatening not to vote it down. In the end three of the MEPs Billy Kelleher, Barry Cowen, Cynthia Ní Mhurchú voted against the motion, while Barry Andrews abstained.
At a Tony Blair Institute event in Brussels last night, Ireland's EU Commissioner Michael McGrath also weighed in on the subject. "Gaza needs to be flooded with aid as quickly as possible,' he told the crowd. 'The situation is just existential for two million people.'
Keffiyeh kerfuffle
A meeting of the Parliament's foreign affairs committee on Israel-Palestine turned into a political flashpoint when two EPP MEPs took aim at a parliament official who was wearing a keffiyeh , the Palestinian headscarf popularised in the 1970s by Yasser Arafat, the deceased leader of the Palestinian Liberation Organisation. Spanish EPP lawmaker Antonio López-Istúriz White fumed: 'Civil servants are not here to make ideology,' his EPP colleague Andrey Kovatchev, from Bulgaria, concurred.
That lit a fire under far-left lawmaker Marc Botenga, who shot back: 'I do not see the issue at all [...] I think that person is dressed completely normally.' He argued that the EPP never complained about Ukrainian symbols.
Sebastian Tynkkynen, a hard-right Finnish MEP, jumped in accusing a translator present of wearing similar 'gear'. Tynkkynen was reportedly seen photographing the staffers, prompting outrage. Spanish Socialist Hana Jalloul, chairing the meeting, attempted to calm things down: 'We don't have authority on that.'
One of the two parliamentary staffers in question was seen escorted out of the meeting room, whilst MEPs and their assistants went to don their keffiyehs for the rest of the hearing.
EU-US
'Technical teams' of EU trade negotiators travelled to Washington on Tuesday for talks, per a Commission spokesman. The last time that was announced, EU trade boss Maroš Šefčovič duly announced a trip to the US. There's no word on that yet, but it begs the question: Why are American negotiators never coming over here?
Šefčovič (pronounced Sheftchovitch, according to Slovaks) spoke to Commerce Secretary Howard Lutnick on Monday and Trade Rep Jamieson Greer on Tuesday.
Amid rising pressure from France to respond to Trump's threats with countermeasures of our own, Germany's Friedrich Merz reiterated the need for caution. 'Over the weekend, I campaigned for us not to implement reciprocal tariffs for now,' the chancellor said at a press conference Tuesday.
So far, von der Leyen has no meetings scheduled with the U.S. president before August 1, EU officials say.
ECR keeps hold of migration files
A last-ditch bid to overturn a controversial power grab by the EPP group, cheered on by the far-right, crashed and burned yesterday, leaving two key asylum files firmly in ECR and EPP hands.
Liberals, Greens, Socialists and The Left lost out. The dossiers will form part of a highly-political asylum overhaul by the Commission. 'The left's furious and virulent reaction to today's vote shows that the political balance on decisive files has shifted,' ECR chief Nicola Procaccini said. Around the bloc
FRANCE | PM François Bayrou unveiled sweeping austerity measures for 2026, including a full freeze on public spending, cuts to healthcare, and the elimination of two public holidays. The move sets the stage for a tense autumn clash in parliament, where using the Constitution's Article 49.3 to force through the budget bill could spark a no-confidence vote and end his premiership. Read more.
SLOVAKIA | PM Robert Fico has again called for a delay to the EU's latest sanctions on Russia, arguing that the Commission's energy guarantees are insufficient. Still heavily reliant on Russian gas, Slovakia is seeking an exemption until 2034 – a request Brussels continues to reject. Read more.
ITALY | Italy is debating a planned 27 July concert by star Russian conductor Valery Gergiev, a close ally of Putin, at the Royal Palace of Caserta, in southern Italy. While critics warn that it will legitimise Kremlin propaganda, others defend cultural dialogue. Read more.
SPAIN | Spain's Amnesty Law stems from a political pact tied to Sánchez's re-election, raising concerns over its legitimacy and EU financial implications, the European Commission's legal representative told the EU's top court on Tuesday. A ruling is expected by year's end. Read more.
POLAND | Lublin Triangle turns five. The foreign ministers of Poland, Lithuania, and Ukraine are meeting in Lublin today to mark the fifth anniversary of the Lublin Triangle, which was launched in 2020. The alliance, forged to strengthen ties and back Ukraine amid Russian aggression, will be marked with a wreath-laying ceremony and a joint press conference.
SWEDEN | Sweden's Green Party is calling the head of the Swedish Security Service, Charlotte von Essen, to appear before the justice committee after recent failures. Over the last weeks, reports revealed that the son of Migration Minister Johan Forssell was active in far-right circles and another investigation showed Security Service bodyguards used the Strava app, potentially exposing Prime Minister Ulf Kristersson's movements.
IRELAND | Former European Commissioner and long-serving MEP Mairead McGuinness will be her Fine Gael party's candidate to become president of Ireland, Irish media reported.
Europe's 2040 climate target isn't just for environmentalists
A 90% emissions reduction positions the EU as a global frontrunner in clean energy, writes William Todts, Executive Director of The European Federation for Transport and Environment (T&E), highlighting Europe's responsibility to lead by example. The strategy prioritizes innovation and international cooperation but faces resistance from right-wing critics, who also oppose the Commission's anti-disinformation efforts.
Meeting of college of commissioners; von der Leyen unveils proposal for the new multi-year financial framework, and commissioners discuss white paper on fighting fraud.
Denmark hosts a meeting of research and industry ministers in Copenhagen.
Commissioner Serafin presents the new Multiannual Financial Framework to the European Parliament's Budget Committee at 12:30 pm.
presents the new Multiannual Financial Framework to the European Parliament's Budget Committee at 12:30 pm. Commissioner Hansen outlines the Commission's priorities for the post-2027 Common Agricultural Policy (CAP) in the AGRI Committee.
outlines the Commission's priorities for the post-2027 Common Agricultural Policy (CAP) in the AGRI Committee. Commissioner Tzitzikostas presents priorities related to transport and tourism to the TRAN Committee.
presents priorities related to transport and tourism to the TRAN Committee. Commissioner Mînzatu addresses the EMPL Committee on employment and social affairs priorities
Contributors: Jacob Wulff Wold, Magnus Lund Nielsen, Nikolaus J. Kurmayer, Thomas Møller Nielsen, Martina Monti, Elisa Braun, Charles Szumski, Alessia Peretti, Natália Silenská, Sarantis Michalopoulos, Inés Fernándes-Pontes, Angelo Di Mambro, Nick Alipour, Laurent Geslin.
Editors: Matthew Karnitschnig, Sofia Mandilara and Charles Szumski.