Markets boosted by talk on eurobonds options
Some of these options could be implemented within the terms of the current EU Treaty while others would require Treaty change, EC president Jose Manuel Barroso said.
German MEPs immediately voiced their opposition to eurobonds, which they fear would raise the cost of borrowing for the eurozone’s largest and wealthiest member.
He warned the parliament that the EU is faced with a fight for its economic and political future, but solid and feasible proposals have been made but not yet delivered.
Even the borrowing of funds by a unified eurozone would not solve all the problems the crisis-hit euro is suffering at the moment.
“We must be honest: this will not bring an immediate solution for all the problems we face and it will come as an element of a comprehensive approach to further economic and political integration,” he said.
The only way to stop the negative cycle and to strengthen the euro is to deepen integration of eurozone countries, but giving the lead to the EC rather than working inter-governmentally as at present, which has not worked, he said.
“This is the way to go,” said Barroso. “It is also the only way for the euro area to really play the role that investors and global partners expect it to play. What we need is a new unifying impulse.”
EU Economic and Monetary Affairs Commissioner Olli Rehn said in July that the feasibility study on common bond issuance would be ready “toward the end of the year”.
Mr Barroso said in the next few weeks the EC will produce proposals to tackle insider trading and market manipulation among others and measures to address concerns over credit rating agencies together with a financial transaction tax.
But even as he received a good reception from MEPs to his remarks, the Austrian parliament’s finance committee refused to add the subject of the expanded European Financial Stability Facility to their agenda.
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