Prime Minister Lawrence Gonzi told Parliament yesterday that Malta would definitely oppose the proposal of introducing Eurobonds if Malta was made jointly and severally liable.

Dr Gonzi was answering questions by Leader of the Opposition Joseph Muscat and other opposition MPs after making a statement on the last European Council of Ministers meeting held last December. Dr Muscat requested information on Malta’s position on the Euro-bonds and their effect on national bonds.

The Prime Minister said that currently, Malta could not take a definitive stand on the Eurobonds proposal as the three ministers making the proposals needed to provide more explanations and information.

Other EU countries were passing negative remarks on the proposals, adding that Malta would definitely oppose the proposal if Malta was made jointly and severally liable. The Eurobonds proposal could only be decided through consensus among member states.

Asked about the lack of Slovak participation in the bailout for Greece but not for Ireland and any possible implications, Dr Gonzi said he was not in a position to provide an answer. What he knew was that the Slovak Prime Minister justified his country’s position because his government had just been elected and no authorisation had been given by the Slovak parliament.

Dr Gonzi agreed with Dr Muscat that the world should never again face what it had over the past three years because of credit-rating agencies, on whose pronouncements a country could survive or flounder.

Malta would follow the EU’s final decisions on a more serious system that would involve three bodies on a European level, as per the Jacques de Larosière report.

As for the visit by German Chancellor Angela Merkel, the two sides had agreed that there must be better enforcement of stability and growth, with more effective measures than to date. There must be better control of public spending for deficit control, which must not only be monitored but efficiently and regularly so. They had also agreed on the position of rigidity on fiscal accountability.

Other points of agreement had been on the importance of such topics as measures for economic growth and job creation, a mechanism to step away from stimulus packages and efforts for greater efficiency in the internal market.

On a question by Labour MP Luciano Busuttil, Dr Gonzi said temporary mechanisms would make for scepticism on international financial markets. It must now be shown that what had been taken as a temporary measure would be superseded by a permanent mechanism.

Germany had demanded that for this to happen there must be an amendment to the EU Treaty. The summit had been held with a view to arriving at an amendment, with a new clause for limited amendments without having to go through a Constitutional process.

With the Prime Minister’s agreement Dr Sant asked about the meaning of “juridical”. Dr Gonzi said the amendment was an empowering one, which meant that Malta could at some time say no. But experience had shown that it was in everybody’s interest to intervene and help Greece out of its problems. Choices had to be made.

Dr Sant asked if this meant that a eurozone member could decide not to join the fund, or whether it could decide to leave the fund.

Dr Gonzi said the new article said members “may” establish a mechanism to adopt a decision on the third part of the treaty, but the decision to establish the fund would have to bear eurozone unanimity.

Dr Sant asked if all eurozone members must participate in the fund, even if they agreed with its establishment.

Dr Gonzi said that if Malta declared agreement with the establishment of the fund, the help to Greece and Ireland would be converted into a new fund. There would be no carte blanche. If a country sought to change parameters, this would only be done by unanimous agreement.

There was an element of uncertainty in international markets as to whether the private sector would be turned on to pitch in to help. There would be no private-sector participation up to 2012, but, thereafter it would have to participate in the restructuring process.

Again with Dr Gonzi’s agreement, Charles Mangion (PL) recalled that Malta’s participation in the efforts to help Greece had been worked out as a rate, and asked if there would be any change of rate on participation in the new fund.

Dr Gonzi said the existent mechanism laid out a plan for countries in difficulty to come into line within a predetermined timeframe. Hopefully there would be no need to call in the new mechanism before 2013, but things might change. It was important to note the categorical statement by all EU members that they were ready to do whatever it took to see the eurozone move forward.

Concluding, he expressed the hope that with the unpopular and stringent measures that Greece and Ireland had had to take, the two countries would make it out of their predicament. Malta supported them both, as well as other countries taking steps to ensure their long-term welfare.