Reinsalu: We are not going to burn the borrowed funds

Government members. From left, Prime Minister Jüri Ratas (Center), foreign minister Urmas Reinsalu (Isamaa), finance minister Martin Helme (EKRE) and economic affairs and communications minister Taavi Aas (Center), at a recent government meeting. Source: Government Office

Minister of Foreign Affairs Urmas Reinsalu (Isamaa) has commented on MEP Jaak Madison's (EKRE) statement on the agreement reached by EU heads of government regarding the Union's long-term budget and the recovery plan to tackle the pandemic fallout, Postimees reports.

After four days of discussions, European leaders at the start of this week agreed to create a €750 billion recovery fund to rebuild EU economies ravaged by the coronavirus crisis. Leaders also agreed on a new EU budget of nearly €1.1 trillion for 2021-2027, creating a combined spending power of €1.824 trillion. It is now the European Parliament's turn to approve these decisions.

According to Madison, many Estonians jumping for joy over the EU recovery fund, for which the EU will take out a shared loan, is out of place. But foreign minister Urmas Reinsalu deemed it a good deal, however.

"I'll put it this way about Madison's statement - if we're getting more funds than we're giving away, we have reason to jump for joy. What if it were the opposite and we had to give away more than we receive?" Reinsalu said, adding that after all, said funds will boost Estonia's economy.

"It's not like we're just going to burn the borrowed funds," he said.

The foreign minister underscored that states are taking out loans and have also done so in the past.

"The issue for Estonia is this - Estonia has one of the lowest debt burdens [in the EU], and we deem it important that the EU loan must be an exception that does not prove the rule," he said.

Reinsalu said the compromise fought for by the prime minister is a working one. 

"He mitigated the risks for us and will ensure a financial contribution that meets our interests," he said.

When asked if the loan essentially means selling off the Estonian state, Reinsalu said he disagrees with the notion, adding that the legal issues and risks Estonia deemed important have been managed. 

Madison called the EU's tax on unrecycled plastics payable by each state to the EU budget a hidden Union-wide tax. 

"Whatever we choose to call this tax, the fact of the matter is that they have agreed that the plastic tax will be hidden in each state's contribution to the EU budget. Thus, there is no specific Union-wide tax; however, all states must pay into the EU budget €0.8 per kilogram of unrecycled plastics," he said.

"I reject this," Reinsalu said, adding that all member states pay tax to the EU.

"The funds distributed by the European Union are not simply falling from the sky," he said.

The foreign minister opined that the tax on plastics serves to motivate member states to recycle their plastic waste to a greater extent. 

Reinsalu pointed out states would only lose their sovereignty in the European Union if decisions were made by majority vote.

"The Commission has also made such proposals before, but Estonia has not supported them. Thus, in this form, this fear is unreasonable," he said.


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Editor: Katriin Eikin Sein

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