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Good morning. A scoop to start: Nato allies are discussing a more forceful response to Vladimir Putin\u2019s hybrid war, including arming surveillance drones, conducting exercises on the Russian border and changing engagement rules to more quickly destroy threats from Moscow.<\/p>\n
And French President Emmanuel Macron has pledged to appoint a new prime minister by Friday evening, after last-ditch talks between political parties to avoid snap parliamentary elections.<\/p>\n
Today, our economy correspondent reports on threats from capitals to cut funding to the future EU budget if the European parliament votes against a proposed new payout structure, and our Rome team has news of an Italian push to cut red tape for companies that hire highly skilled migrant workers.<\/p>\n
Cash clash<\/h3>\n
Germany and other countries won\u2019t pay more into the EU budget if the European parliament rejects a key part of the current budget proposal, tabled by the European Commission to make spending more flexible, writes <\/strong><\/em>Paola Tamma<\/strong><\/em>.<\/strong><\/em><\/p>\n Context: The commission has proposed bundling together agricultural subsidies and regional funds, which traditionally make up two-thirds of the bloc\u2019s budget, in the EU\u2019s next long-term budget for 2028-34. The aim is to give countries more leeway on how to spend the money, addressing other priorities such as defence and competitiveness.<\/p>\n The two biggest groups in the European parliament, the centre-right European People\u2019s Party and the Social Democrats, are toying with the idea of rejecting these new national plans, arguing they would result in capitals slashing funds for regions and farmers, according to officials.<\/p>\n \u201cWhat we don\u2019t accept is the renationalisation of the EU budget and that every member state can do what they want,\u201d said Siegfried Mure\u015fan, who leads negotiations for the EPP on the budget, adding that regional and agricultural policy should have \u201cpredictable amounts\u201d.<\/p>\n But to formally reject the commission proposal would require a parliamentary majority, and even then the commission would not be forced to amend its proposal. Political groups need to decide whether to pull the trigger ahead of the next plenary session in late October. <\/p>\n While the threat is legally toothless, it\u2019s political dynamite.<\/p>\n Germany and other countries that are net contributors to the EU budget have already threatened to close the spigot if the budget doesn\u2019t reflect new priorities such as security and boosting growth.<\/p>\n \u201cA status quo budget proposal favouring traditional spending areas would mean that member states have to invest more nationally to face [new] challenges. This would definitely leave less money for the EU budget,\u201d said a German official.<\/p>\n \u201cA rejection of the [EU budget] proposal would turn the whole negotiations into turmoil. It would be playing with fire,\u201d they added. <\/p>\n The World Economic Forum in Davos is sailing against the wind. Multilateralism is in retreat, protectionism is on the rise, and great power rivalry \u2014 between the US and China, between the west and the global south \u2014 is remaking global governance.<\/p>\n Italy is taking steps to make it easier for employers to get permission for highly skilled foreign workers to enter the country in a tacit acknowledgment of the labour shortage weighing on the country\u2019s economic prospects, write <\/strong><\/em>Amy Kazmin<\/strong><\/em> and <\/strong><\/em>Giuliana Ricozzi<\/strong><\/em>.<\/p>\n Context: Prime Minister Giorgia Meloni\u2019s government has vowed to crack down on irregular migrant workers trying to reach Italy from across the Mediterranean, a key plank of its political programme. But it is also simultaneously trying to make it easier for employers to bring in skilled workers to fill yawning gaps in the labour market, amid a wave of retirements in an ageing workforce.\u00a0<\/p>\n The Bank of Italy\u2019s governor Fabio Panetta has warned that by 2040, Italy\u2019s labour market will see its labour force shrink by 5mn workers, leading to a 11 per cent drop in GDP.<\/p>\n Under existing rules, when employers identify and want to hire a skilled foreign worker, they must obtain a nulla osta<\/em>, or \u201cno objection\u201d certificate from Italy\u2019s interior ministry. But employers have long complained about the complexity and duration for obtaining this clearance for prospective hires.<\/p>\n Yesterday, the country\u2019s Senate approved a measure that will cut the time to obtain the permit to work in Italy from 90 to 30 days for workers with university degrees, or many years of experience in their trades.<\/p>\n The measure, which is expected to be approved by the lower house of parliament by the end of the year, is expected to help companies import much-needed IT specialists, industrial technicians, skilled construction workers and other trained, experienced employees more rapidly.\u00a0<\/p>\n Senator Andrea De Priamo, a member of Meloni\u2019s Brothers of Italy party, is among those backing the measure: \u201cIt is clear that in some sectors, as often pointed out by businesses, quotas of trained foreign workers are very essential.\u201d<\/p>\n European commission president Ursula von der Leyen and other EU leaders speak at the Global Gateway Forum in Brussels.<\/p>\n<\/li>\n EU finance ministers meet in Luxembourg.<\/p>\n<\/li>\n EU digital affairs ministers meet in Horsens, Denmark.<\/p>\n<\/li>\n<\/ol>\n Cold shower:<\/strong> Materials critical to hot water tanks were not included on a revised EU list of authorised substances.<\/p>\n<\/li>\n Brexit beef:<\/strong> Brussels has warned the UK it must fulfil its commitment to check goods entering Northern Ireland before it signs a full-scale veterinary deal.<\/p>\n<\/li>\n Discord at the opera: <\/strong>La Fenice\u2019s orchestra in Venice has objected loudly to the appointment of a conductor aligned with Giorgia Meloni\u2019s party<\/p>\n<\/li>\n<\/ul>\n Free Lunch<\/strong> \u2014 Your guide to the global economic policy debate. Sign up here<\/p>\n The AI Shift<\/strong> \u2014 John Burn-Murdoch and Sarah O\u2019Connor dive into how AI is transforming the world of work. Sign up here<\/p>\n<\/div>\n<\/div>\n<\/div>\n Are you enjoying Europe Express? <\/em>Sign up here<\/em> to have it delivered straight to your inbox every workday at 7am CET and on Saturdays at noon CET. Do tell us what you think, we love to hear from you: <\/em>europe.express@ft.com<\/em>. Keep up with the latest European stories <\/em>@FT Europe<\/em><\/a><\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\nChart du jour: Davos in decline<\/h2>\n
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