Angela Merkel a deal-maker in EU financing

BRUSSELS - Angela Merkel, the new German Chancellor, emerged as the key deal-maker at her debut EU summit, breaking the deadlock over plans to plough billions of euros into the economies of its new Eastern European members.

While British Prime Minister Tony Blair faced uproar at home for ceding 10.5 billion ($18 billion) of the value of the British rebate, Merkel was widely hailed as the real victor of the marathon negotiating session.

After more than 18 hours of tense talks, European leaders clinched a deal over EU financing for 2007-13. But the turning-point came when Merkel laid down plans for a spending ceiling, reversing some of the cuts planned for Eastern European nations.

Diplomats said Merkel had "restrained" President Jacques Chirac of France, rather than giving him the free hand he enjoyed under Germany's previous leader, Gerhard Schroder.

While the Chancellor returned to Berlin in triumph, for Blair the summit was a gruelling and potentially politically costly affair.

Under a complex agreement he will not claim a British rebate on most of the spending applied to the 10 new countries by 2013, except on subsidies for farmers. In all, Britain's net contribution to the EU over the seven years will be roughly 62 billion.

- INDEPENDENT