The European Union’s Carbon Border Adjustment Mechanism (CBAM) will impose an additional 25 per cent tax on energy-intensive goods exported from India to the EU, a new report said on Wednesday.

This tax burden would represent 0.05 per cent of India’s GDP, according to the report titled “The Global South’s Response to a Changing Trade Regime in the Era of Climate Change” by the independent think tank Centre for Science and Environment (CSE).

These findings are based on data from the past three years (2021-22, 2022-23, and 2023-24). CBAM is the EU’s proposed tax on energy-intensive products, such as iron, steel, cement, fertilizers, and aluminium, imported from countries like India and China. The tax is based on the carbon emissions generated during the production of these goods.

The EU argues that this mechanism creates a level playing field for domestically manufactured goods, which must adhere to stricter environmental standards, and helps reduce emissions from imports. But other nations, particularly developing countries, are worried this would harm their economies and make it too expensive to trade with the bloc.

The move has also sparked debate at multilateral forums, including UN climate conferences, with developing countries arguing that, under UN climate change rules, countries cannot dictate how others should reduce emissions.

Avantika Goswami, who leads CSE’s climate change programme, said that India’s CBAM-covered goods exports to the EU accounted for 9.91 per cent of its total goods exports to the bloc in 2022-23. She said 26 per cent of India’s aluminium and 28 per cent of its iron and steel exports were destined for the EU in 2022-23. These sectors dominate the basket of CBAM-covered goods shipped from India to the EU.

In 2022-23, the exports of CBAM-covered goods to the EU made up about one-fourth (25.7 per cent) of India’s total such goods exported globally, which is significant for the industries operating in these sectors. Currently, hydrogen and electricity are not exported from India to the EU. Of India’s total goods exported worldwide, CBAM-covered goods exports to the EU constitute only about 1.64 per cent.

(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)

The EU on Friday congratulated Keir Starmer on Labour’s election win in Britain, with Brussels foreseeing warmer ties with London — though little scope to change existing post-Brexit arrangements.

European Council President Charles Michel called Starmer’s victory “historic”, and stressed the EU and Britain “are crucial partners”.

European Commission chief Ursula von der Leyen added she looked forward to working with Mr. Starmer “in a constructive partnership to address common challenges and strengthen European security.”

Also Read | U.K. General Election 2024 highlights

Britain’s new Prime Minister has vowed to reduce trade frictions with the European Union, forge closer security arrangements — and relax travel restrictions for touring musicians.

But Mr. Starmer is also adamant his government will never reverse Brexit nor seek to be part of the European single market. His slogan is “Make Brexit Work”.

While that necessarily reduces the scope for better dealings, a more cooperative London will be greatly welcomed in Brussels, according to one EU official and one EU diplomat, both speaking on condition of anonymity.

A “return to internationalist policies” from London would be “refreshing”, the EU official said.

“If there is a different approach, one of cooperation and not with a hostile attitude, then things become easier — but not simpler,” the diplomat said.

They both warned all “easy” points of cooperation had already been hammered out and enshrined in a painstakingly negotiated 2020 EU-U.K. Trade and Cooperation Agreement and a 2023 Windsor Framework.

But even if the overall deal would not be changed, some aspects could have hard edges filed down, they and analysts said.

Defence cooperation

Those could include: easing some rules around plant and animal imports; Britain continually aligning with EU rules on chemicals and standards; opening up youth exchange programmes; and mutual recognition of professional qualifications.

One key area where both sides see a priority is close cooperation is defence.

Increased geopolitical instability, notably with Russia’s war in Ukraine, and the prospect of a new Donald Trump U.S. presidency — with fears America could retreat from its global security role — are fuelling that.

“It is in the interest of the EU and also the U.K.,” the EU diplomat said. “It would be interesting if the British come back on that issue with proposals.”

Mr. Michel said he would see Starmer on July 18 when Britain hosts a European Political Community summit “where we will discuss common challenges, including stability, security, energy and migration”.

Estonian Prime Minister Kaja Kallas — tapped to become the EU’s next foreign policy chief — noted “the U.K.’s commitment to our common security” in her own congratulatory message to Mr. Starmer.

Mark Leonard, director of the European Council on Foreign Relations, a think tank, told AFP the surge in international volatility and the “big danger” of what a President Trump might do made shared defence “more relevant”.

Britain and 23 of the EU’s 27 member countries are in NATO, the usual forum for defence cooperation. But Mr. Trump during his 2017-2021 presidency called into question America’s commitment to the alliance.

No more ‘psychodrama’

While Britain under the Conservatives ended up taking a very arm’s-length stance with Brussels on ideological grounds of post-Brexit “sovereignty”, Starmer’s government is expected to shift to a “rational policy discussion” about U.K. interests, Leonard said.

The Tories, he said, grappled with a decades-long “psychodrama around Europe… which has destroyed the party”.

But Labour still has to bow to Britons’ general animosity to immigration, he cautioned.

“I think the only really, really strong red line is about returning to freedom of movement, because that’s the only clear signal which came out of the Brexit referendum,” he said.

Barry Colfer, director of research at the Institute of International and European Affairs, also said the result of the U.K. elections was not so prominent in Brussels’ thinking right now.

“What’s happening in France or even what’s happening in the U.S. I think plays a much more central role in the EU,” he said.

That said, European elites were “optimistic” about what Mr. Starmer’s stance would be, he added, anticipating a “generally more pragmatic, evidence-driven, constructive approach” with more diplomatic outreach than under his Tory predecessors.

“I can just see more enhanced cooperation in really obvious areas where it’s a win-win situation between the U.K. and the EU to cooperate: around climate change, and security, around scientific research, around digitalisation,” Mr. Colfer said.

European Commission President Ursula von der Leyen and Estonia’s Prime Minister Kaja Kallas walk together to a media conference during an EU summit in Brussels, early on June 28, 2024.
| Photo Credit: AP

European Union leaders signed off on a trio of top appointments for their shared political institutions on Thursday, reinstalling German conservative Ursula von der Leyen as president of the European Commission for another five years.

At the side of Ms. von der Leyen, who heads the EU’s executive branch, would be two new faces: Antonio Costa of Portugal as European Council president and Estonia’s Kaja Kallas as the top diplomat of the world’s largest trading bloc.

“Mission Accomplished,” outgoing EU Council President Charles Michel told reporters after chairing a summit of the bloc’s leaders, as Ms. von der Leyen and Ms. Kallas accompanied him at a joint a news conference. Mr. Costa took part via video-link.

Ms. Von der Leyen expressed her gratitude for a shot at a second term of office, saying: “I’m very honored and I’m delighted to share this moment.”

Ms. Kallas, who as the EU’s top diplomat will lead the bloc’s foreign and security policy with Russia’s war on Ukraine in its third year, noted that “there is war in Europe, also growing instability globally. My aim is definitely to work for the European unity.”

Both Ms. von der Leyen and Ms. Kallas should now be approved by European lawmakers. Mr. Costa’s nomination only needed the leaders’ approval, and he will start in his new role in fall.

After the three centrist political families in the European Parliament struck a deal earlier this week, the top jobs package was widely expected to be approved without controversy at the summit in Brussels.

But far-right politicians, emboldened by their strong showing in EU parliament elections earlier this month, slammed it as a stitch-up.

Italian Prime Minister Giorgia Meloni made clear her displeasure at being excluded from preparatory talks with a small group of leaders who divvied up the top jobs. Her nationalist European Conservatives and Reformists group emerged as the third force in the EU parliament elections earlier this month.

Ms. Meloni voted against Portugal’s Costa and Estonia’s Kallas, two sources close to the discussions told The Associated Press on condition of anonymity. Ms. Meloni abstained on Ms. von der Leyen for European Commission president, the same sources confirmed. The officials requested anonymity in line with EU practice.

In a post on X, Ms. Meloni said the way that mainstream parties put forward the trio “is wrong in method and substance. I decided not to support it out of respect for the citizens and the indications that came from those citizens during the elections.”

Nationalist Hungarian Prime Minister Viktor Orban was the only other major critic of the deal.

“European voters were cheated,” he said on Facebook Thursday evening. “We do not support this shameful agreement!” His objections were moot: the package only needed a two-thirds majority to pass.

The June 6-9 election saw the EU’s legislature shift to the right and dealt major blows to mainstream governing parties in France and Germany, but the three mainstream groups managed to hold a narrow majority of seats.

Mr. Costa, a former Portuguese prime minister, hails from the center-left Socialists and Democrats group, which came second. Ms. Kallas is prime minister of her tiny Baltic home country. She comes from the pro-business liberal group, which is also home to embattled French President Emmanuel Macron and lost seats in the June poll, trailing into fourth place.

EU top appointments are supposed to ensure geographic and ideological balance, but ultimately it is the 27 leaders who call the shots – and generally the most powerful among them.

While Mr. Costa’s appointment is decided by EU leaders alone, both Ms. von der Leyen and Ms. Kallas will also need to be approved by a majority of lawmakers. With 720 members, the threshold is 361. That vote could happen when the newly constituted European Parliament meets for the first time in July.

The European Council is the body composed of the leaders of the 27 member states. If confirmed, Mr. Costa’s role as president would be to broker deals within an often hopelessly divided political club. In Portugal, he is known as a savvy negotiator.

But Ms. von der Leyen’s role is the most powerful. As commission president, her job is to devise and implement the bloc’s shared policy on everything from migration to the economy and environmental rules.

With the far right pushing back against the flagship EU policies ushered through in the last five years, Ms. von der Leyen’s critics charge she is poised to roll back ambition.

Brussels:

European Union leaders agreed on Friday to nominate Ursula von der Leyen of Germany for a second five-year term as president of the European Commission, the EU’s powerful executive body.

At a summit in Brussels, the bloc’s 27 national leaders also picked former Portuguese premier Antonio Costa as the future chair of their European Council meetings and selected Estonian Prime Minister Kaja Kallas as the next EU foreign policy chief.

The leadership package represents continuity for the 27-member bloc, with centrist pro-EU factions keeping hold of top posts despite a far-right surge in elections to the European Parliament earlier this month.

The deal was announced by the current European Council president, Charles Michel, on social media.

The trio won broad backing from leaders but diplomats said right-wing Italian Prime Minister Giorgia Meloni abstained from the vote on von der Leyen and voted against Costa and Kallas.

Von der Leyen’s nomination still needs approval from the European Parliament in a secret ballot – widely seen as a trickier proposition than her endorsement by EU leaders.

At the summit, the EU also signed a security agreement with Ukraine, debated how to bolster EU defences against Russia and agreed bloc’s strategic priorities for the next five years.

The security deal underlines EU support for Kyiv fighting off Moscow’s invasion for a third year, despite gains by the far-right in European elections, uncertainty created by French snap elections and the U.S. presidential vote in November.

The agreement lays out the EU’s commitments to help Ukraine in nine areas of security policy – including arms deliveries, military training, defence industry cooperation and demining.

“These commitments will help Ukraine defend itself, resist destabilisation, and deter future acts of aggression – more concrete proof of the EU’s unshakeable resolve to support Ukraine for the long haul,” Michel said.

The leaders will reiterate their pledge to support Ukraine as long as it takes, stressing that “Russia must not prevail” and that Ukraine must get back the land annexed by Moscow.

DEFENCE DEBATE

The war in Ukraine laid bare the EU’s lack of preparedness for a conflict as the bloc struggles to supply Kyiv with enough weapons against Russia, prompting calls for more EU coordination of defence systems and investment in defence industries.

Diplomats said von der Leyen told the summit that between 1999 and 2021, the EU increased defence spending by 20%, China by 600% and Russia by 300%, even before Moscow’s massive rise in military spending after its invasion of Ukraine in 2022.

According to diplomats, von der Leyen told leaders the EU needed to invest 500 billion euros ($535.30 billion) in defence over the next 10 years. Financing options ranged from national contributions, dedicated revenue streams – called the EU’s own resources – and joint borrowing, von der Leyen said.

Investment in defence is part of the EU’s “strategic agenda” that the leaders aim to agree before dinner on Thursday – a document that tells EU institutions what European governments want them to focus on during their 2024-2029 term.

Apart from defence, the agenda calls for a more competitive EU to withstand economic pressure from China and the United States and for preparing the bloc for enlargement that would include Ukraine, Moldova and the Western Balkans.

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)

Secret shipment: The EU estimates around 6 billion cubic metres of Russian LNG was shipped via the bloc’s ports last year.
| Photo Credit: Reuters

The European Union (EU) on June 24 slapped new sanctions on Russia over its war on Ukraine, targeting Moscow’s shadow fleet of tankers moving liquefied natural gas (LNG) through Europe.

At a meeting in Luxembourg, where the sanctions were endorsed, EU Foreign Ministers also expressed concern about a rise in hybrid attacks by Russia — including allegations of election interference, cyber-attacks and sabotage.

In an effort to push Russia into using more costly routes for energy purposes, the EU will “forbid reloading services of Russian LNG in EU territory for the purpose of transshipment operations to third countries,” the Ministers said in a statement.

The EU estimated that about 4-to-6 billion cubic metres of Russian LNG was shipped via EU ports last year. Russia is suspected of running a “ghost fleet” of up to 400 ships to evade sanctions and keep up the flow of energy earnings so that it can finance the war.

The measures will target ship-to-ship and ship-to-shore transfers as well as reloading operations. It also involves a crackdown on the re-export of LNG via the EU, plus a ban on new investments to help Russia complete LNG projects it is working on.

Scores of new “entities” — often companies, banks, and other agencies — were also added to the EU’s list, including some in China, Turkey and the United Arab Emirates. Many are accused of circumventing the bloc’s sanctions or providing sensitive equipment to Russia.

Targeted entities

More than 50 officials were also being targeted with asset freezes, as well as travel bans. Russia’s President Vladimir Putin, Foreign Minister Sergey Lavrov and scores of lawmakers and oligarchs are among more than 1,700 people already listed by the EU.

Over 400 entities previously hit include companies working in the military, aviation, shipbuilding and machinery sectors, the Wagner mercenary group, political parties and banks.

As they arrived for the meeting, some Ministers insisted that action must be taken to end hybrid attacks in Europe by Russia that take place in a “grey zone” just below the threshold of military action which are aimed at destabilising Ukraine’s backers.

Finnish Foreign Minister Elina Valtonen said that “there’s a plethora of actions they have been undertaking against European countries.”

Finland has closed border crossings with Russia, blaming the Kremlin for an orchestrated campaign exploiting migrants.

“There is no observer status in Europe anymore to Russia’s aggression. We are all victims of Russia’s aggression,” she said. “It is crucial that we keep on aiding Ukraine because Russia only understands power.”

Her Lithuanian counterpart, Gabrielius Landsbergis, said there is “ample evidence” of malign activity by Russia.

“Unfortunately, I don’t think that we are yet sending the right message,” he said. “Moscow has to get a very clear message that whenever they escalate, they will receive an answer from our side.”

The countries agreed to coordinate the respective countries’ bio policies, regulations, and research and development support measures. File
| Photo Credit: Reuters

South Korea, India, the United States, Japan, and the European Union (EU) have come together to launch an alliance to put joint efforts into building a resilient supply chain in the biopharmaceutical sector, the South Korean presidential office said in Seoul on June 6.

The inaugural meeting of the Biopharmaceutical Alliance, held in San Diego during the Bio International Convention 2024, had representatives from government officials and bio and pharmaceutical companies from the participating countries, South Korea’s Yonhap news agency reported.

The participants emphasised the importance of a reliable and sustainable supply chain and agreed to coordinate the respective countries’ bio policies, regulations, and research and development support measures.

They acknowledged that the production of essential raw materials and ingredients is concentrated in a few countries and agreed to work together to build a detailed pharmaceutical supply chain map.

The alliance was launched in response to the drug supply shortages experienced during the Covid-19 pandemic.

South Korea and the U.S. agreed to form the alliance during their dialogue on core emerging technologies in December and expanded it to include Japan, India and the EU, the report said.

European Commission President Ursula von der Leyen, center left, reviews the honour guard with Montenegro’s President Jakov Milatovic in Montenegro’s capital Podgorica, on Oct. 31, 2023.
| Photo Credit: AP

Montenegro’s new government was confirmed on October 31, with the Prime Minister promising to unblock the Balkan nation’s stalled European Union integration process as a top EU official was set to hold talks in the small NATO member country.

Parliament approved the new Cabinet with 46 votes in favour and 19 against after a session that lasted all night. Montenegro’s Assembly has 81 members but not all were present at the vote.

The government was formed after months of political bickering that followed an election in June. The centrist Europe Now party of Prime Minister Milojko Spajic won the election but without enough support to form a government on its own.

To form the government, the winning coalition received backing from staunchly anti-Western groups under the condition that one of their leaders, Andrija Mandic, was elected as the speaker of parliament — an influential political position.

Mr. Spajic said his government would be pro-European despite Mandic’s election. He dismissed reports that his Cabinet would be influenced by neighbouring Serbia, from which Montenegro split in 2006 after an independence referendum.

“We can’t wait to make a result for our country,” Mr. Spajic told reporters. “We hope to unclog the European integration, move forward quickly and become the next member of the European Union.”

Mr. Spajic spoke shortly before EU Commission President Ursula von der Leyen was set to hold talks in the capital, Podgorica, as part of a tour of Western Balkan nations aspiring to join the 27-nation union. Ms. Von der Leyen visited North Macedonia and Kosovo before Montenegro and is slated to travel to Serbia later on Tuesday.

Six Western Balkan countries are at different stages on their path to join the EU, in a process expected to take years.

As the war rages in Ukraine, EU officials recently have sought to push the process forward and encourage Balkan nations to boost reform to join. Ms. Von der Leyen was discussing details of the 6 billion-euro ($6.37 billion) package for Western Balkan countries, along with tensions that still exist in the region long after ethnic wars of the 1990s.

Recent violence and tensions between Serbia and Kosovo have been high on von der Leyen’s agenda as the EU seeks to negotiate a solution for the dispute. Kosovo split from Serbia in 2008 but Belgrade has refused to recognize the former province’s independence.

In Montenegro, U.S. and EU officials have suggested that the country, should avoid introducing an anti-NATO and anti-Western political party into its coalition if it wants to join the bloc.

Mr. Mandic had called for close ties with Russia rather than the EU, criticized Montenegro’s NATO membership and was against splitting from Serbia. But, when elected as Parliament Speaker on Monday, Mr. Mandic said he is ready to “send some new messages.”

Hundreds of opposition supporters waving Montenegrin flags staged a protest in front of the parliament building in the capital against the new government. Opposition lawmakers criticized the new government as anti-European because of the participation of pro-Serb parties.

An ambitious 2021 agreement by more than 140 countries and territories to weed out tax havens and force multinational corporations to pay a minimum tax has been weakened by loopholes and will raise only a fraction of the revenue that was envisioned, a tax watchdog backed by the European Union (EU) has warned.

The landmark agreement, brokered by the Organization for Economic Cooperation and Development (OECD), set a minimum global corporate tax of 15%. The idea was to stop multinational corporations, among them Apple and Nike, from using accounting and legal maneuvers to shift earnings to low- or no-tax havens.

Explainer | What is a global minimum tax and what will it mean?

“Those havens are typically places such as Bermuda and the Cayman Islands where the companies actually do little or no business. The companies’ manoeuvres result in lost tax revenue of $100 billion to $240 billion a year,” the OECD has said.

According to the report, being released on Monday by the EU Tax Observatory, the agreement was expected to raise an amount equal to nearly 10% of global corporate tax revenue. Instead, because the plan has been weakened, it says the minimum tax will generate only half that — less than 5% of corporate tax revenue.

Much of the hoped-for revenue has been drained away by loopholes, some of them introduced as the OECD has been refining details of the agreement, which has yet to take effect. The watchdog group estimates that a 15% minimum tax could have raised roughly $270 billion in 2023. With the loopholes, it says, that figure drops to about $136 billion.

Over the summer, the OECD agreed to delay for at least a year — until 2026 — a provision that would have let foreign countries impose additional taxes on U.S. multinational companies that failed to pay at least a 15% rate on their overseas earnings.

The EU Tax Observatory noted that even under the rules of the 2021 agreement, companies would maintain some ability to evade taxes. Companies that have tangible businesses — factories, warehouses, stores and offices — operating in a particular country, for example, could continue to pay a tax rate below 15%. That carveout, the EU Tax Observatory warned, could “give firms incentives to move production to countries with tax rates below 15%.” “This risks exacerbating the race-to-the-bottom with corporate income tax rates,” it said.

Another loophole lets countries offer tax credits, for such things as conducting research and investing in local factories, that can reduce companies’ tax rates below the 15% mark and still comply with the 2021 agreement.

The Tax Observatory also expressed concern that the race by governments to grant tax breaks for green technologies to fight climate change “raises some of the same issues as standard tax competition. It depletes government revenues.”

“It also risks increasing inequality by boosting the after-tax profits of shareholders, who tend to be towards the top of the income distribution,” it said.

The EU Tax Observatory isn’t calling for an outright ban on green-technology subsidies. But it is urging governments to consider other policies to offset the financial gains to the wealthy from such tax breaks.

The group said that multinational corporations shifted $1 trillion — 35% of the profits they earned outside their home countries — to tax havens. American companies account for about 40% of such global profit shifting.

Last week, U.S. Treasury Secretary Janet Yellen said an agreement on a tax on companies that have no physical presence in a country but that earn profits there, such as through digital services, wouldn’t be finalised until 2024.

“There are some matters that are important to the United States and other countries that remain unresolved — open issues that still must be resolved before the treaty can be signed″ she said after meeting with European Finance Ministers.

The EU Tax Observatory is run by Gabriel Zucman, a leading economist and tax-and-inequality researcher of the Paris School of Economics and the University of California, Berkeley. Its report is based on the work of more than 100 researchers around the world who often work with government tax agencies. It draws upon new sources of data on multinational corporate finances and offshore wealth held by corporations.

Also read | Global pact on minimum corporate tax of 15%

Despite its criticisms of what has happened to the minimum tax, the EU Tax Observatory praised a separate effort to stop the wealthy from dodging taxes. In 2017, tax authorities around the world began exchanging taxpayer information from financial institutions to better enforce tax laws. The results, essentially ending bank secrecy, have been dramatic, the Tax Observatory found.

Until the “automatic information exchange,’’ was introduced, it said, virtually all wealth that the world’s rich held offshore went untaxed. Now, only 25% escapes taxes.

Still, the group says, “the effective tax rates of billionaires appear significantly lower than those of all other groups of the population’’ because the richest use tax-avoidance schemes. In the United States, it says, billionaires pay an effective average tax rate of 23%, including all taxes at all levels of government. The poorest 10% of Americans pay more – 25.6%.

The EU TAX Observatory is calling for a 2% global tax on billionaires’ wealth, a proposal it says would raise $250 billion annually from fewer than 3,000 people.

President of the European Commission Ursula von der Leyen speaks during a news conference with the Albanian Prime Minister Edi Rama in Tirana, Albania, on Sept. 28, 2021. Leaders from the European Union and the Western Balkans are holding an annual summit in Albania’s capital to discuss the six countries’ path to membership in the bloc. fight.
| Photo Credit: AP

Leaders from the European Union and the Western Balkans will hold a summit in Albania’s capital on October 16 to discuss the path to membership in the bloc for the six countries of the region.

The main topics at the annual talks — called the Berlin Process — are integrating the Western Balkans into a single market and supporting their green and digital transformation. The nations in the region are Albania, Bosnia, Kosovo, Montenegro, North Macedonia and Serbia.

The senior EU officials attending the summit in Tirana are European Commission President Ursula von der Leyen, and European Council President Charles Michel. They will be joined by German Chancellor Olaf Scholz and French President Emmanuel Macron.

The six Western Balkan countries are at different stages of integration into the bloc. Serbia and Montenegro were the first Western Balkan countries to launch membership negotiations a few years ago, followed by Albania and Macedonia last year, while Bosnia and Kosovo have only begun the first step of the integration process.

Russia’s war in Ukraine has put integration of the Western Balkans into the EU at the top of the 27-nation bloc’s agenda. The EU is trying to reinvigorate the whole enlargement process, which has been stalled since 2013, when the last country to become a member was Croatia.

The EU had made it a requirement for Western Balkans to reform their economies and political institutions before joining the bloc.

Ms. Von der Leyen mentioned a new growth plan for the Western Balkan countries that she will make public at the summit: opening new trade routes in seven specific areas of the EU’s common market for the Balkan countries, which need to implement quick reforms that in turn will be accompanied by investment.

Ms. Von der Leyen, speaking at a news conference on October 15 after meeting with Albanian Prime Minister Edi Rama, gave no further details.

A bitter dispute between Serbia and Kosovo, a former Serbian province that declared independence in 2008, remains a great concern for the EU before the summit. A recent shootout between masked Serb gunmen and Kosovo police that left four people dead and sent tensions soaring in the region seems to have suspended the EU-facilitated dialogue to normalize their ties.

EU officials have called on the Balkan countries to overcome regional conflicts and stand together as Russia wages war in Ukraine.

The summit, which is being held for the first time in a non-EU member country, takes place at a pharaonic landmark, known as the Pyramid. It was built in 1988 as a posthumous museum for Albania’s communist-era strongman, Enver Hoxha.

This picture taken on October 11, 2023 shows an aerial view of buildings destroyed by Israeli air strikes in the Jabalia camp for Palestinian refugees in Gaza City.
| Photo Credit: AFP

The “overwhelming majority” of European Union (EU) countries supported continuing aid payments to the Palestinian Authority, according to the bloc’s top diplomat Josep Borrell.  

“…The overwhelming majority was against the idea or the proposal of suspending the payments to the Palestinian Authority,” Mr. Borrell said in Muscat, where he had been for a meeting with the Gulf Cooperation Council.  Mr. Borrell said that the payments, about €600 million per year, would be reviewed and not suspended. The EU is the top international funder of the Authority.

The clarification came late on Tuesday, a day after the EU declared that it was not suspending development aid to the Palestinian territories. The confusion had arisen after European Commissioner for neighbourhood and enlargement, Olivér Várhelyi, had stated publicly that payments would “immediately” stop following Hamas’s bloody attack on Israel over the weekend. Over 1,000 people including children and the elderly were killed and over 150 were kidnapped by Hamas from Israeli sites.

In retaliation, Israel began bombing Gaza on a large scale and stopped food, water, medicine and fuel from entering the strip of land, home to 2.3 million Palestinians. Palestinian authorities reported that 1,055 have died since Saturday in the bombing.

Mr. Borrell said that Israel’s response to the attack, “like cutting water, cutting electricity and food to a mass of civilians” was against international law. Israel had a right to defend itself against the Hamas attack but its response had to be within the limits of international law, he said.

Several EU countries, including France, Spain, Ireland and Luxembourg had, on Monday, privately or publicly opposed the move to suspend payments to the Palestinian territories, while some others like Austria and Germany had temporarily suspended their bilateral assistance.

Foreign Ministers of EU countries on Tuesday met informally via video link and in Muscat and discussed how they could continue engaging the Palestinian Authority, as per Mr. Borrell, and they drew a clear distinction between Hamas, the Palestinian people, and the Palestinian Authority.

“We consider Hamas a terrorist organisation and what they have done shows – certainly – that they behave like this,” Mr. Borrell said in a televised press briefing, as he reiterated that the Palestinian Authority was a partner of the EU.

Mr. Borrell said that “collective punishment against all Palestinians will be unfair and unproductive” and “against our interests, and against the interests of the peace”.  Collective punishment is prohibited under international humanitarian law.  

Payments to the Palestinian territories was not going to be delayed, “because the Palestinian people are also suffering”, he said. The funds were going towards development activities, United Nations-supported activities and public services. Mr. Borrell said both EU countries individually and suggested the bloc might review the payments to ensure no payments were going to Hamas, which is an EU-designated terror group.