04 DECEMBER 2002

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Danish PM on European tour as hard bargaining for more cash begins

By Kurt Sansone

Danish Prime Minister Anders Fogh Rasmussen is on a lightning tour of European capitals ahead of the Copenhagen summit, in a bid to convince member states of the Danish presidency’s proposed ‘improved’ financial package for accession countries.

However, as Mr Rasmussen makes the rounds accession countries are still disappointed with the size of the ‘improved’ financial package. Negotiators from accession countries, including Malta have entered the final round of hard bargaining but time is not on their side.

The Danish presidency has repeatedly warned candidate countries that unless they wrap up outstanding negotiations before the Copenhagen summit on 12 and 13 December they risk missing out on enlargement.

Maltese negotiators are expected to close the agriculture chapter by tomorrow, which leaves the VAT zero rating issue as the sole outstanding element up for negotiation. But with the likeliness of obtaining a concession fast fading away Malta may agree to settle for a transition period after which it will have to introduce a minimum VAT rate of 5 per cent on food and medicine.

It is widely expected that the deals with candidate countries over their respective financial packages will be clinched at the last minute in Copenhagen. EU analysts describe this as ‘typical’ of EU negotiations when important decisions have to be taken.

Malta finds itself in a ‘funny’ situation, being classified as one of the three rich accession countries. Negotiators are making their case for a meaningful financial package that suites the country’s needs. No details were released on either the Danish proposal, or the requests made by the Maltese negotiating team.

As yet, Cyprus has been the only country that has said that it is close to signing. On the other hand, Poland, which has a very large farming community, is the most vocal in its demands for a more generous settlement.

The Danish Prime Minister has already visited Madrid, Lisbon, Berlin and Rome on his 15-nation tour. But it is going to be hard for accession countries to siphon off more money from EU member states at a time when domestic economies are not looking that good.


Copyright © Network Publications Malta.
Editor: Saviour Balzan
The Business Times, Network House, Vjal ir-Rihan San Gwann SGN 07, Malta
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