STRASBOURG – Germany’s Angela Merkel and France’s Nicolas Sarkozy are to propose modifications to EU treaties to improve governance of the eurozone, the BBC said. The announcement came after their first meeting with Italian Prime Minister Mario Monti since he took office.
Sarkozy said they would “propose modification of treaties to improve eurozone confidence so there is more integration and convergence”. France and Germany disagree about measures to strengthen the eurozone. In particular, they disagree about whether bonds should be issued by the whole of the eurozone instead of individual countries. On Wednesday, a German bond auction failed to raise the target amount.
On Wednesday, European Commission president Jose Manuel Barroso launched a consultation on whether the 17 eurozone countries could issue joint stability bonds. But Barroso stressed that the creation of the bonds would require much greater scrutiny of the budgets and economic policies of individual members.
Germany opposes both the issuing of joint bonds and greater involvement for the European Central Bank (ECB) in bailing out troubled economies. On Thursday, French Foreign Minister Alain Juppe said that it was “urgent” that the ECB be allowed to intervene in the debt crisis.