12-15C
A mainly dry day with sunny intervals.

Find a...

Date Job Car Home















Big four agree €130bn package

The leaders of Germany, France, Italy, and Spain agreed yesterday on a €130bn package to try to revive economic growth in Europe.

However, they differed over whether and how to launch joint bonds to combat the debt crisis.

After a four-way summit in Rome, Italian prime minister Mario Monti said the EU should adopt a series of growth measures worth about 1% of the region’s GDP at a summit next week.

“Growth can only have solid roots if there is fiscal discipline, but fiscal discipline can be maintained only if there is growth and job creation,” Monti told a joint news conference after the talks.

The growth measures include rising the European Investment Bank’s capital, redirecting unspent EU regional funds and launching project bonds to co-finance major public investment programmes.

No new measures were announced yesterday.

German chancellor Angela Merkel, endorsed the growth package but made no mention of any move towards mutualising past eurozone debt or new borrowing.

French President François Hollande appeared to voice impatience with Berlin’s reluctance, saying it should not take 10 years to create jointly underwritten euro bonds.

He said greater solidarity was needed among member states before they abandon more sovereignty to EU institutions.

The German position essentially amounts to the reverse.

“I consider euro bonds to be an option ... but not in 10 years,” Mr Hollande said in a challenge to the chancellor. “There can be no transfer of sovereignty if there is not an improvement in solidarity.”

Ms Merkel has argued that members of the euro must transfer control over national budget and economic policies to Brussels before Germany would consider common debt issuance.

Their contrasting comments left much work for diplomats to produce a convincing blueprint for closer fiscal and banking union at a full EU summit next Thursday and Friday.

That plan is expected to include steps towards a banking union, starting by putting the ECB in charge of supervising large cross- border eurozone banks.

— Reuters Home

More from the Irish Examiner