Cut in EU’s cohesion funding to Lithuania ‘unacceptable’, president says

Lithuanian President Gitanas Nausėda said on Friday that the proposed cut in the cohesion funding for Lithuania in the EU’s next long-term budget was “unacceptable”.

The president expressed the opinion before arriving in Brussels for the European Council meeting which starts on Friday.

The EU’s Cohesion Fund seeks to reduce economic disparities within the bloc and is aimed at the member states with gross national income (GNI) per capita less than 90 percent of the EU average.

Cohesion funding for Lithuania may be cut by around one-fourth in the 2021–2027 budget, compared with the previous period, as the country’s economic indicators have moved closer to the bloc’s average.

“We believe that the reduction of cohesion funding by such a percentage is unacceptable,” the president said.

According to Nausėda, the cut may be somewhat offset by compensation for losses caused by emigration that could amount to almost 200 million euros for Lithuania.

But the president called the current proposal an “intermediate result” because “it is an underestimation of what has happened over the past decade, when Lithuania has lost slightly more than 10 percent of its population”.

Gitanas Nausėda in Brussels | AP nuotr.

According to Nausėda, the cut in funding may prevent Lithuania from catching up with more developed Western European countries.

“Cohesion politics remains very important for the Eastern European countries. Without it, we can’t expect to continue our successful convergence with the EU average,” the president commented.

Nausėda also promised to fight for a faster increase in direct payments to Lithuanian farmers.

At around 170 euros per hectare, direct payments to Baltic farmers are now the lowest in the EU, well below the bloc's average of over 250 euros. Nausėda said he would ask to increase the payments to 196 euros in 2021.

EU leaders will also discuss the European Commission's proposal to borrow 750 billion euros from financial markets to help countries worst-hit by the coronavirus.

Under the Commission's proposal, Lithuania could apply for 6.3 billion euros from the Recovery Fund, including 3.9 billion euros in grants and 2.4 billion euros in loans. But the sum may change after the talks.