How farming outrage will crash another EU leaders’ summit

Good morning. France’s Emmanuel Macron will use an EU summit in Brussels today to push a plan for more joint EU borrowing to finance Europe’s biggest defence rearmament since the cold war, a move that will provoke a barnstorming argument with other leaders — led by Germany’s Olaf Scholz — who are vehemently opposed.

Meanwhile, it will be Portuguese premier António Costa’s last summit. In Lisbon, centre-right leader Luís Montenegro was invited shortly after midnight to form a government following fractured election results. 

Sticking to the summit theme, here our trade correspondent previews (yet) another debate on Ukrainian food imports. While our energy correspondent explains why, at a separate gathering, others will discuss a Russia-free future for Europe’s nuclear industry.

Going against the grain

Farming issues are set to hijack a second consecutive European summit as some leaders push for more restrictions on Ukrainian food imports, writes Andy Bounds.

Context: Yesterday morning, EU negotiators agreed a deal to cut imports of Ukrainian produce after huge protests by farmers in central Europe and France, who claim a glut has hit their income. But hours later, member state representatives refused to sign off on the measures as some said they did not go far enough.

Polish Prime Minister Donald Tusk, who is struggling to contain farmer protests and blockades of the Ukrainian border, will demand changes at the summit, backed by France’s President Emmanuel Macron.

The deal extended free access for Ukrainian goods for another year but created an “emergency brake”, automatically putting tariffs on poultry, eggs, sugar, oats, maize, honey and groats (grain kernels) if quantities exceeded a certain level.

Poland wants to make it easier to pull. Rather than being triggered when Ukrainian imports reach the average imported in 2022 and 2023, it wants to include 2021, the much lower prewar level, too.

That would cut exports of eggs and sugar in half, and poultry by almost a third. Warsaw also wants wheat included. The result, according to European Commission calculations, would be a €1.2bn loss of exports for Ukraine unless they find alternative buyers.

Diplomats in favour of tighter curbs say Ukraine can now use the Black Sea again to ship to traditional markets in Asia and Africa.

Last night, farming groups slammed the “weak compromise”. “The burden on the EU farming sector will persist and so will their discontent,” said a statement by Copa-Cogeca, the farmers’ umbrella group.

German Socialist MEP Bernd Lange defended the deal he negotiated: “I think more tariffs would be the wrong message to give to Ukraine when it is fighting for freedom and democracy.”

The issue has now been kicked up to today’s leaders’ summit. German Chancellor Olaf Scholz, along with his Dutch colleague Mark Rutte and others are determined to defend the deal.

“There are many of us who are saying it was too rushed, and won’t work,” said a senior EU diplomat. “The danger is that leaders will now start to pull it apart even more.”

If member states cannot agree, tariffs will be imposed on all Ukrainian imports on June 6.

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The nuclear options

Brussels is aglow with nuclear chatter ahead of the first global summit on atomic energy today with more than 30 countries attending, including China and the US, writes Alice Hancock.

But among the tougher questions is, how can the EU wean itself off Russian fuel?

Context: The bloc has invested billions of euros in reducing its reliance on Russian gas since the full-scale invasion of Ukraine, but switching supplies of the enriched uranium needed for nuclear fuel is a far more complex matter.

Figures from the environmental think-tank Bellona show that imports of Russian nuclear fuel have doubled since February 2022, with member states paying Moscow €686mn last year.

This is largely due to stockpiling over fears that Moscow could — as it did for gas — cut off supplies. Though one senior EU official said member states were reluctant to switch suppliers because “it’s a headache”.

Nuclear fuel is not a commodity but a manufactured product specific to different reactor designs, and must be licensed by nuclear regulators.

Ukraine, unsurprisingly, has moved fastest to diversify away from Russian supplies in collaboration with the US company Westinghouse, which delivered the first batch of replacement fuel to Ukraine in September.

Officials in Brussels say another producer should be operational “shortly”.

Several leaders will speak at the summit including French President Emmanuel Macron, Belgian premier Alexander De Croo and European Commission president Ursula von der Leyen — an assembly of politicians you wouldn’t have expected in the aftermath of the 2011 Fukushima nuclear accident. 

EU officials will also get an update from the International Atomic Energy Agency on the situation at the Russian-occupied Ukrainian nuclear power plant in Zaporizhzhia. 

What to watch today

1. Summit of EU leaders in Brussels.

2. Nato secretary-general Jens Stoltenberg hosts a meeting with Slovenia’s Prime Minister Robert Golob.

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Source: Economy - ft.com