Germany's Schaeuble, Merkel Push for Crisis Cure on Summit Eve

Wednesday, 17 Oct 2012 04:54 PM

 

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German Finance Minister Wolfgang Schaeuble said on the eve of a summit of European leaders that debt-ridden eurozone states must help themselves while Chancellor Angela Merkel said Europe needed to resolve its crisis to become competitive once again.

Over two days starting on Thursday, EU leaders meeting in Brussels are expected to deal with the issues of banking supervision, the single market, a centralised euro zone budget, a single bank resolution fund, direct recapitalisation of banks from rescue funds and stricter fiscal oversight.

"Countries need to tackle problems themselves," Schaeuble said. "We need to make sure that they have the necessary time in financial markets and we're doing that."

Greece, whose debt woes triggered the eurozone crisis, is in its fifth year of recession and has struggled to meet fiscal targets set by the "troika" of international lenders. But on Wednesday it agreed with its lenders on most austerity cuts and reforms needed to unlock fresh aid.

Schaeuble stressed that problems needed to be solved in eurozone member states since that was where they had arisen, adding that the eurozone bailout fund was there to help countries help themselves. He reiterated his view that further steps towards political integration would strengthen the bloc.

On Tuesday, Schaeuble had called for a leap forward in European integration, saying the bloc needs a commissioner with power over member nations' budgets and reform of European Parliament decision-making.

He said on Wednesday that his plans for a "currency commissioner" did not threaten democracy and added that budget rules in Europe needed to be kept. Parliaments in each country needed to stick to deficit limits and decide how they would achieve this in their budgets, he said.

Meanwhile, Merkel said Europe's main tasks were to regain credibility and become competitive again.

At a meeting of European center-right parties in Bucharest, she acknowledged the achievements of Greece, Portugal and several eastern European states in implementing reforms and said: "It is particularly important to stick together at this time and to support each other."

"True friendship only proves its worth when there's a crisis and the going gets tough," she said, adding that Germany wanted a successful Europe and would fight for this.

© 2014 Thomson/Reuters. All rights reserved.

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