Budget, EU – Baltic States, Financial Services, Funds, Latvia, Markets and Companies

According to the proposals published on Wednesday, the European Commission proposes cutting funding for the Common Agricultural Policy (CAP) and Cohesion Policy by around 5 percent in the EU's post-2020 budget.

The Latvian finance minister said that the Commission's proposals were a compromise as evidenced by the fact that both contributor and recipient nations were not happy with the budget proposals.

"Latvia is mostly concerned about the funding for agriculture and cohesion because our position does not look too good after the announcement of the European Commission proposals. Anyway, it is important for us to see the formula to be used to calculate the EU funds available to Latvia in the coming years. Latvia would like the GDP to be among the factors in the formula and that it should take into account the population decline as it has a negative impact on Latvia's competitiveness,” she said.

Some of the initiatives proposed by the Commission are good, for example, increased allocations to the Erasmus+ program, security of borders, migration control etc., the Latvian finance minister said. However, Latvia disapproves of the proposed shift of the EU funding “towards the South”.

"Therefore we will be preparing arguments for further negotiations and getting ready to fight for the national interests. But we must consider the proposals in their entirety - if there are gains for us in some aspects, we might accept a reduction in a different aspect,” Reizniece-Ozola said.

She said that leveling out the standard of living across Europe was still important because the existing gap would make it difficult to implement other joint EU initiatives, such as the common social policy and the unemployment benefit scheme.