Brussels, 16/12/2010 (Agence Europe) - The European Council managed to reach agreement on limited” amendment of the Treaty. President Herman Van Rompuy tweeted the news shortly after 8.00pm: “We have an agreement on treaty amendment”. The text agreed reads: “The member states whose currency is the euro may establish a stability mechanism to be activated if indispensable to safeguard the stability of the euro area as a whole. The granting of any required financial assistance under the mechanism will be made subject to strict conditionality”.
The European Council, which got down to work at 5.00pm on Thursday 16 December, managed, then, to create the conditions for a permanent mechanism, better able to protect the financial stability of the euro and the euro area which have been severely tested by the Greek and Irish crises. Opening the session, Van Rompuy had displayed a certain optimism: “I hope we'll have a white Christmas but not a white night” (i.e. one without sleep), he said. Almost all the comments of the heads of state and government of the 27 EU member states before the Summit on limited change to the Treaty to make it easier to put such a mechanism in place had been conciliatory.
European Commission President José Manuel Durão Barroso said he expected the Council to take “very important decisions” on the crisis mechanism and on a limited change to the Treaty. German Chancellor Angela Merkel said the crisis mechanism was “an act of solidarity in the cause of a stable euro and a stable Europe” - every country had to assume “its responsibilities” in this “very limited” amendment of the Treaty. UK Prime Minister David Cameron said the crisis mechanism was “important” for the UK too, but added: “We need to make sure that Britain is not liable to spend money under that mechanism”. Swedish Prime Minister Fredrik Reinfeldt said: “It is important to get the treaty change in place”, before remarking: “There has to be more competitiveness in the economies of Europe: there is a risk we are doing too much short-sighted crisis management and too little of the reforms needed”. Irish Prime Minister Brian Cowen, determined to implement the crisis measures agreed for his country, felt that it was “very likely” that there would be a referendum in Ireland on the change to the Treaty. Greek Prime Minister Georgios Papandreou spoke of a “collective challenge” requiring “a sense of responsibility”.
The summit was preceded by a meeting of the leaders of the EPP family - see related article - and by statements of their stances by the other political groups in the European Parliament - see related article. There were also several bilateral meetings: the President of the Italian Council Silvio Berlusconi, for example, met Belgian Prime Minister Yves Leterme, who did not rule out aid for Belgium being on the day's agenda. This Council marks the de facto end of the Belgian Presidency of the EU Council of Ministers - on 1 January, Hungary takes over the rotating Presidency.
During the opening session, after meeting European Parliament President Jerzy Buzek - see his statement - the heads of state and government discussed the conclusions reached by euro area finance ministers in Brussels on 27-28 November and debated the draft text prepared by Van Rompuy on the amendments to be brought to the Treaty. This draft, which EU sources say contains only one single operational paragraph, was the main item on the Summit agenda.
That amendment of the Treaty is limited is the precondition for a permanent mechanism that will ensure the financial stability of the euro area as a whole. The draft text will hereafter have to be passed by the other EU institutions concerned before returning to the European Council in March for formal approval. Then the ratification process will begin, the hope being that the amendment of the Treaty will come into force on 1 January 2013.
The Summit was also expected to ask finance ministers to examine the operation of and the arrangements for the permanent mechanism, with a view to its coming into force at the start of 2013, when the current temporary mechanism expires. It will, therefore, be for finance ministers to discuss in fine detail the role of the private sector in the new mechanism and the proposal for Eurobonds, although it is possible that these and other issues will be discussed by the heads of state and government, after the strong pressure brought by the European Parliament. President in office of the Ecofin Council, Belgian minister Didier Reynders, said that the euro area countries had to “continue to consolidate their public finances”.
In the evening, on the leaders' programme was a working dinner with European Central Bank (ECB) President Jean-Claude Trichet. Discussion was to focus on current economic developments, on the day when the ECB decided to increase its capital by €5 billion - see related article. Against the general tendency, a statement from the Washington: IMF Managing Director Dominique Strauss Kahn in an interview with Bloomberg says he does not believe that member states will accomplish very mluch in their deliberations.
Once the issues broached at the opening session have been settled, on Friday morning, the Summit will be devoted to EU international relations - see related article. The final press conferences are expected at around 1.00pm. (B.C./A.By./F.G./Gp/transl.rt)