Cohesion Fund

German Budget Proposal Stirs EU Controversy

Poland’s Prime Minister Beata Szydlo and German Chancellor Angela Merkel during the welcome ceremony in Warsaw
A new ice age in German-Polish relations? Picture source: Reuters

Only a few days after German Chancellor Angela Merkel implored European leaders to take their fate into their own hands, old rifts are threatening to throw a wrench into the much-needed show of unity.

An official seven-page German government proposal has drawn a sharp rebuttal by neighbor Poland, which says the proposal violates existing European Union law. The spat comes at a time when the EU is trying hard to demonstrate unity ahead of the departure of one of its largest member states, Great Britain, and growing tensions with its main western ally, the United States.

Under the German government proposal, first seen by news agency Reuters and other media on Tuesday, EU member countries failing to meet standards on the rule of law could be cut off from the block’s funding program, also known as the Cohesion Fund System. The cohesion fund supports development in the union’s poorer member states and could hit net aid recipients such as Poland and Hungary particularly hard, as both have been accused of violating rule of law principles.

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