Germany to demand EU treaty changes to establish eurozone
"crisis resolution mechanism";
Former EU Commissioner: Ireland must make further cuts to avoid bailout
The FT reports that Germany will next month outline proposals for a permanent "crisis resolution mechanism" for the eurozone, laying down rules for member states facing debt rescheduling - proposals that would require changes to the EU treaties. The new mechanism would replace the €440 billion European Financial Stability Facility, which is supposed to last for three years, until June 2013, three months before a German general election.
The article notes that the plans for the crisis resolution mechanism as well as tough sanctions against fiscal "sinners" in the eurozone will be put forward in the second phase of negotiations in the taskforce chaired by European Council President Herman Van Rompuy in November. Germany is hoping for agreement by summer next year, which would mean treaty changes could be attached to the accession treaty for Croatia. The article notes that the UK is thought to be one of the member states most opposed to any treaty change.
Meanwhile, the Irish Independent reports that former Irish EU Commissioner Peter Sutherland last night said that Ireland must go well beyond the €3 billion deficit reduction previously set for the 2011 budget to prevent the EU or IMF taking control of the economy. "Economic and fiscal conditions mean tightening in the range of €4 billion to €5 billion should be implemented", he said. The governing and opposition parties met last night to discuss further budget measures.
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