Hollande steps up eurobonds push - deepened EU economic union discussed
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Hollande steps up eurobonds push - deepened EU economic union discussed

French President Francois Hollande stepped up his push last night for the launch of eurobonds after a summit of EU leaders in Brussels exposed divisions on the issue.

Prime Minister Lawrence Gonzi attended the summit.

Hollande said he wanted to see eurobonds "written into the agenda" of the European Union going forward, saying he saw jointly pooled eurozone debt as a fundamental means of bolstering the debt-stricken single currency.

German Chancellor Angela Merkel has repeatedly come out against eurobonds and Hollande told a news conference after five hours of talks among EU leaders in Brussels he had a "different conception" of what eurobonds offer Europe.

He said: "There is perhaps a means by which to mutualise... future debt to enable countries... to access financing more easily on (money) markets."

Suggesting this would allow governments to "finance investments", the new Socialist president said that pooling liabilities for past debts was "unacceptable" but that eurobonds could help countries paying high borrowing costs, such as Spain and Italy.

(Malta has not taken a definitive stand on the eurobonds proposal but Dr Gonzi is on record as saying that Malta would definitely oppose the proposal if it was made jointly and severally liable.)

Merkel said there had been a "balanced" discussion on eurobonds.

"There was a debate on the subject of eurobonds, but very balanced and with different points of view," she said after the summit.

She said she had "explained the German position" and Hollande "said what he had already said previously, but there were broad differences".

Several participants expressed doubts about the benefits of interest rates being unified across the eurozone, Merkel added.

Hollande said he was not alone at the EU table in favouring the introduction of eurobonds.

EU president Herman Van Rompuy said the subject was "briefly touched upon" by several leaders "in the framework of deepening the monetary and economic union".

However, he stressed: "There was nobody asking for the immediate introduction of this."

Van Rompuy said after the summit meeting that he will present a report next month on deepening economic union as the bloc tries to overcome the eurozone debt crisis.

Van Rompuy said the leaders held an "in-depth" discussion on the developments in the single currency area and reaffirmed their commitment to safeguarding its "financial stability and integrity".

"Our discussion also demonstrated that we need to take Economic Monetary Union to a new stage. There was general consensus that we need to strengthen the economic union to make it commensurate with the monetary union," he said.

"I will report in June, in close cooperation with the President of the Commission, the President of the Eurogroup and the President of the European Central Bank, on the main building blocks and on a working method to achieve this objective."

 
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