Upcoming negotiations regarding the financial framework of the European Union for 2007 through 2013 promise to be conflictual. Within such a context , volume 3 of France, Germany and Europe. Perspectives, A Franco-German Thought on the European Budget's Future analyzes the status quo of the financial system of the European Union. The deficit is, above all, on the spending side: too large a part of the budget is allocated to the transfer of resources between member states, while the part which is allocated to financing real European public goods is too small. The side of receipts is on the other hand organized in a much more satisfactory manner: the system of contributions establishes a direct link between the national budgets and the European budget, thus guaranteeing a welcome dose of budgetary discipline. France and Germany share in these negotiations objectives which are to a great extent similar: a strict limitation of the global budget, the preservation of a certain level of protection for European agriculture, and the support at minimum levels of regional and structural actions. This contribution means these objectives, in appearance contradictory, may be reached in a coherent manner. Such a scenario involves the cofinancing of agricultural policy by member states and the creation of a fund for defense. The European budget would thus concentrate more on the creation of a real European added-value, without losing sight of regional solidarity objectives, the encouragement of the agricultural sector, and the lightening of the fiscal burden.
 

Friedrich Heinemann is Senior Researcher at the Deutsche Gesellschaft für Auswärtige Politik e.V in Mannheim, and is responsible for the working group on European Integration.

Maxime Lefebvre contributed to this publication as he was in charge of European Affairs at Ifri.