Ulf Kristersson is the prime Minister of Sweden.
The next long-term EU budget will be negotiated during the most challenging and defining moment for the continent since the end of the Cold War: Russia’s ongoing war of aggression against Ukraine, intensified hybrid attacks against European democracies and a global economy that is increasingly fragmented and unpredictable.
These historically challenging conditions mean there can be no business as usual.
Europe must tackle this new geopolitical and geoeconomic reality head on and, accordingly, its long-term budget must be visibly geared toward addressing today’s key challenges — not offer a continuation of the status quo.
Europe needs a bold change of perspective, on par with the creation of the single market or the euro. And with little to no room in national budgets to manage an increase in the EU budget, focus needs to drastically shift from the distribution of funds to targeting necessary investments.
Three main elements are particularly important here: The first is strengthening European security, defense, resilience and preparedness. We must constrain Russia’s capabilities, particularly through our support to Ukraine, which needs to be strong, enduring and predictable.
Member countries also need to increase their national defense spending. Along these lines, the Swedish Parliament recently unanimously agreed on an investment plan toward spending 5 percent of GDP on defense. Similarly, the EU budget can and should be used to stimulate investment by means of promoting joint development and procurement. Furthermore, cohesion funds should be redirected toward improving cross-border military mobility.
As for preparedness, Russia’s aggression against Ukraine has put the spotlight on the need for robust and reliable supply chains and food security. Consequently, the European Common Agricultural Policy should be increasingly focused on achieving these objectives within the food sector.
The second priority is migration management and internal security. High migration has caused major strains on our societies in recent years. Still, the number of irregular arrivals today is unacceptably high while returns remain too low. Thus, the next long-term budget must address the need for migration management, both by means of financing the full implementation of the Pact on Migration and Asylum, and by exploring further measures including third country partnerships. Such partnerships should focus on preventing irregular migration, increasing returns, and combating smuggling and trafficking networks.
At home, the EU must further develop its capabilities to combat organized crime, terrorism and radicalization — both online and offline. Seven out of 10 criminal networks operate in more than three EU countries, which underscores the necessity for cross-border solutions, including the adequate financing of Europol and Eurojust.
The third concern is leveraging private investment and boosting competitiveness. As the global economic playbook changes, Europe must do what is necessary to boost its economic strength. And while long-term competitiveness is primarily achieved by improving framework conditions, like simplification and deepening the single market, the bloc must also rapidly increase investment in research, innovation, new technologies, digitalization and AI.
Key programs like Horizon Europe should be further developed to enhance Europe’s strategic position as a global center for innovation and excellence. And the green transition should remain a driver for growth. Europe must be capable of attracting the best researchers in the world.
Member countries already have a big responsibility to make the reforms needed to boost private investment. However, the bloc’s long-term budget should be used to leverage private investment to a much larger extent than it currently is. Rather than simply distributing funds across a range of sectors, it should use guarantees to encourage risk-taking in primarily innovative sectors and facilitate scale-up.
In addition to these main policy priorities, a strong rule-of-law conditionality is also a must. In recent years, the EU has developed its rule-of-law toolbox and put it to effective use. Now is the time to further expand and develop the application of fundamental rights and include rule-of-law conditionality in the budget. Taxpayers must be able to trust that the EU’s funds are used appropriately and responsibly.
Finally, we must do all this by using our existing resources far more efficiently — not by increasing the budget’s volume or by means of introducing new common debt instruments. Labeling something a priority means that other things are less important. And as a result, we must be ready to make the hard decisions — both as individual member countries and as a bloc.
The world is rapidly changing. For a long time, calls to modernize the EU budget meant a step-by-step reprioritization. But this time, small steps won’t be enough. The bloc must rethink and reprioritize to both tackle the new challenges we face today and seize opportunities.
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