Merz Rejects New EU Debt and Calls for Smaller Budget

German Chancellor Friedrich Merz has called for a revised proposal for the European Union’s long-term budget for 2028-2034, arguing that current spending plans are too ambitious.

Speaking ahead of consultations with EU leaders in Brussels, Merz said the proposed figures should be reduced.

He was responding to a recent compromise proposal that would cut only 2% from the European Commission’s original €1.76tn budget plan.

EU leaders face the challenge of financing the bloc’s growing investment needs while many member states continue to grapple with strained public finances after years of economic and geopolitical crises.

Merz also firmly rejected the idea of taking on additional joint EU debt to fund future spending priorities.

The German chancellor said discussions should focus not only on expenditure but also on the Union’s overall revenue.

He expressed hope that member states could reach agreement on a new budget framework before the end of the year.

The next seven-year budget is expected to reflect new priorities, including higher spending on European defense and measures to strengthen the bloc’s economic competitiveness.

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