Today, Wednesday, the European Commission proposed a European Union budget for 2025 estimated at about 200 billion euros ($215 billion), in addition to 72 billion euros from a debt financing fund established in 2020 for economic recovery from the consequences of the Covid pandemic.
The largest share of the budget is scheduled to be allocated, as usual, to agricultural support – about 54 billion euros. A share of 49 billion euros will be allocated to regional development in the poorest regions of Europe.
The 2025 budget represents the annual tranche of the EU’s seven-year budget from 2021 to 2027, which was drawn up in 2020 but – unusually – increased earlier this year.
The European Union budget sets maximum limits on what the Union can spend in various areas. Most of the revenue needed to cover spending consists of contributions from member states, based on each country’s gross national income.
Part of the funding also comes from customs and other fees. Normally, the European Union is not allowed to borrow to finance the budget.
But during the Covid-19 pandemic, the bloc’s countries exceptionally agreed in 2020 to develop a separate recovery budget for debt financing called the Next Generation EU programme.
The European Commission estimates that about €72 billion from the Next Generation EU program is scheduled to be spent in 2025 – most of this amount will be spent on reform plans drawn up by member states, although part of it will cover items in the main EU budget.
It is noteworthy that the member states of the European Union and the European Parliament must approve the draft 2025 budget.
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