On Monday, Handelsblatt newspaper reported that even as it is already squeezed by several persistent crises, including the conflict in Ukraine, migration, and energy supply shortages, now higher interest rates are adding even more pressure to the EU’s long-term budget.

The German outlet noted that following the crisis which was the pandemic, those issues have gone on to overwhelm the EU’s financial resources. The newspaper noted that the bloc’s budget reserves are already “practically exhausted,” even as more crises are erupting, and the ability of Brussels to meet them with resources is dwindling.

The report breaks just ahead of an EU meeting to determine the 2024 budget and its Multiannual Financial Framework (MFF) for 2021-2027.

The paper reported that the willingness of EU member states to absorb the costs of the single budget is low, especially in Germany, which is the biggest contributor to the bloc. The outlet warned that all of this was putting the ability of the EU to meet new challenges or react to unforeseen events at risk, as it is endangering the bloc’s flagship programs.

The outlet went on to point out that the Union’s budget is filled with mandatory spending objects, and that only leaves €30 billion ($32 billion) per year for such programs as supporting Ukraine, accelerating the energy transformation, strengthening the chip industry, boosting domestic clean-tech production, opening up new sources of raw materials and countering China’s Silk Road initiative.

Handelsblatt concluded that if confined to rigid mandatory spending, “the EU cannot rise to become a geopolitical power,” and that the current budgetary structure means the economic bloc cannot even meet the challenges it faces now.