EU Council head proposes €5bn Brexit emergency fund

EU Council President Charles Michel on Friday proposed setting up a €5 billion ($5.7 billion) reserve fund for any unforeseen consequences of Brexit on bloc member states. “Brexit is challenging for all of us and that is why we propose a Brexit reserve of €5 billion,” said Michel as he unveiled his latest proposal for a long-term EU budget. It will be debated by bloc leaders next week.

Brexit with or without an agreement on future ties “will have consequences in Europe for the member states, and that’s why I think it’s … necessary to ask the commission to prepare for a needs assessment by November 2021,” he said.

The EU and Britain are currently in negotiations to agree on the basis of trade relations after a post-Brexit transition phase ends on December 31. “We all know that the ongoing negotiations are not easy,” the AFP news agency quoted Michel as saying.

Michel, who will chair the first face-to-face meeting of EU leaders since coronavirus lockdowns were lifted, proposed a smaller 2021-27 budget. A long-term EU budget of €1.074 trillion was floated, along with a recovery fund of €750 billion for pandemic-hammered economies, with two-thirds in grants and a third in loans.