Finance

UK and US quietly pushing for EU expansion to bolster Ukraine funding


Britain and the US are pushing the European Union to expand as a way of securing additional funding for Ukraine, sources have told the Telegraph.

Washington and London were said to be “invested” in the EU’s dramatic eastward expansion amid fears Kyiv’s faltering counter-offensive has narrowed the path to peace. They are also pressuring the bloc to grant Ukraine membership status.

Brussels has announced the intention to make Ukraine a full member of the EU in less than seven years as part of an enlargement plan that also includes the Western Balkans.

Kyiv’s potential accession has ignited a simmering debate over a significant overhaul to the bloc’s budget and decision-making processes.

A recently-leaked internal analysis said it would cost member states £161 billion over seven years, turning many existing members into net payers for the first time.

US has become ‘deeply involved’

EU leaders held their first debate on enlargement this week at a summit in Granada, Spain to discuss how the bloc would need to reform itself before letting new countries in .

A European diplomatic source said the US had become “deeply involved” in the debate after aid to Ukraine was cut from Washington’s budget to avoid a government shutdown.

British officials have also privately expressed support for Ukraine’s accession, but can’t publicly push too hard for Kyiv to join after Brexit.

“EU membership will be the base case scenario should the offensive stall,” the source told the Telegraph.

“Without the conflict being resolved, the absence of clear borders will impact speedy progress on Nato membership.

“Focus will therefore increasingly be on the EU track and Brussels knows this.”

Emmanuel Macron had initially sought to broker peace by keeping dialogue open with his Russian counterpart Vladimir Putin.

But the French President has since abandoned that plan, instead staking his credibility on the EU’s enlargement to include Ukraine.

Plan at risk of getting tangled in EU power struggle

Ursula von der Leyen and Charles Michel, the presidents of the EU’s Commission and Council, have also championed Kyiv’s accession.

But it risks being wracked by disputes over voting rights, the highly controversial question over how much power each country has, as well as complete overhaul of the bloc’s agricultural and levelling up funds.

German chancellor Olaf Scholz has demanded change to the EU’s governing treaties to ensure Berlin maintains its traditional power-base alongside France.

There are also vast questions over whether the EU’s existing 27 member states can afford bringing in nine new countries as planned.

The Czech Republic, Estonia, Lithuania, Slovenia, Cyprus and Malta would all lose access to the bloc’s levelling-up funds, according to internal EU analysis on enlargement.

The bloc’s overall budget would have to increase in size by 21 per cent to some £1.27 trillion over a seven-year period, with existing members having to send more cash to Brussels to shoulder that burden.

Ukraine, which would become the poorest EU member, with its fourth-largest population, was handed candidate status by the bloc in June.

It hopes to be allowed to start formal membership talks in December, when EU leaders meet in Brussels for their final summit of the year.

EU cannot ‘finance this on the back of a Brussels beer mat’

This will mark an important moment for securing Ukraine’s long-term future, according to UK and US officials.

With Brussels agreeing to shoulder the burden for Kyiv’s economic stability, the two G7 members believe it will provide confidence to businesses to invest in the war-torn country’s rebuild.

The Treasury in Britain doesn’t believe it has the necessary funds to commit to propping up Kyiv’s economy for much longer, while the US has its own domestic battles over aid for Ukraine.

Brussels has already proposed a €50 billion cash pot for Ukraine’s day-to-day government spending between 2024 and 2027.

But an EU diplomat warned: “If London thinks the EU member states can finance this on the back of a Brussels beer mat they are deeply mistaken.”

In private conversations with their counterparts in London and Washington, EU diplomats have expressed they will need to step up their involvement in areas like the South China Sea, Afghanistan and Sub Saharan Africa.



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