Brussels, 24/05/2012 (Agence Europe) - Europe's leaders held frank talks at their informal dinner meeting on Wednesday 23 May about expanding Economic and Monetary Union (EMU) to stem the sovereign debt crisis. The president of the European Council, Herman Van Rompuy, will brief the European Summit at the end of June on how this can be achieved, but there was no agreement over dinner on the eurobond question.
On Thursday 24 June, Van Rompuy said that it was time to move to the next stage of EMU and in June, along with the European Commission and the ECB, he would be unveiling the main steps (rather than a detailed plan) in expanding economic and monetary union under the existing treaties. The idea of setting up a European bank bailout fund and a European savings guarantee scheme has been mooted.
Eurobonds. The Polish prime minister, Donald Tusk, said it was clear that on the eurobond question, there would not be agreement in the near future because the same group of countries is still sceptical about the idea. The countries opposed to pooling a portion of sovereign debt are Austria, Germany, Finland and the Netherlands. The German chanellor, Angela Merkel, said that countries had set out their views and discussed their disagreements. Germany says the current EU treaties do not allow for the creation of eurobonds.
The Italian prime minister, Mario Monti, said that most countries in Europe backed the idea, including the United Kingdom and Slovakia and the idea would remain on the negotiating table. A fervent supporter of the eurobond idea, the French president, François Hollande, said they could be used to pool new lending to help struggling countries benefit from lower interest rates. He said that as far as Germany was concerned, eurobonds cannot be the end point, whereas as far as France is concerned, they are a starting point. Hollande said he respected Merkel's view that eurobonds are not instruments for growth. (MB along with JK/EH/FG/MD/transl.fl)