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European Union Agrees to Long-Term Budget


European Union leaders have agreed to a long-term budget after Britain offered to reduce its annual rebate.

The leaders reached a final deal in Brussels early Saturday after British Prime Minister Tony Blair agreed to cut his country's rebate by nearly $13 billion.

Mr. Blair described negotiations as extraordinarily difficult. German Chancellor Angela Merkel played a key role in the talks and praised the deal. Polish Prime Minister Kazimierz Marcinkiewicz said the budget was reached in the spirit of solidarity.

The six-year plan begins in 2007. It includes billions of dollars of development aid to new member states from Eastern Europe, and caps overall spending at $1 trillion dollars for the six-year period.

The final deal calls for a review of all EU budget revenue and spending, including farm subsidies.

Some information for this report provided by AP, AFP and Reuters.