The Eurogroup managed to save the furniture at the last moment and take away an agreement of minima for the reform of the euro. Were on the verge of going home with empty pockets. But after 15 hours of talks, european ministers of Finance tied to the creation of a safety net for bank failures and the reform of the rescue fund (Esm) and a sort of agreement about the disagreement: The proposed franco-German budget of the euro zone is still alive, but with an addendum not less: the partners of the single currency did not achieve a “common vision” on the “necessity” and the “design” of an instrument to stabilise the euro zone in times of crisis.
The ministers took a year and a half with those topics on the agenda. In the case of the fiscal support for the rescue fund, the agreement was in principle closed. And yesterday afternoon also practically was the reform of the Esm. But about ten in the night it all came crashing down. Italy protested against the conditions that were introduced on the restructuring of debt within the changes to the bailout fund; France demanded angry by the budget of the euro zone; Germany had incorporated the unemployment insurance in europe, and the Netherlands is opposed to any proposal that would mean a “stabilization” in the euro area.
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The negotiators proposed to suspend the meeting and convene another Eurogroup for the next week, a few days of the Summit the Euro, according to diplomatic sources. Half past seven in the evening, and after multiple breaks, bilateral meetings and calls, an agreement was reached. Were closed by order two legs of Banking Union: a fund, bank resolution and the reform of the Esm, which will include funds for countries that are facing crisis point, and the collective action Sultanbet clauses, by which a majority of investors can agree to and impose on the rest of the conditions of a restructuring. In contrast, the ministers were unable to move forward in the deposit guarantee fund community. The head of the Eurogroup, Mário Centeno, said after the meeting that it is still “difficult” to make progress in that area.
The conversation turned to encallarse in the budget of the euro area and the unemployment insurance community, that the German minister Olaf Scholz managed to sneak into the final document. Diplomatic sources explained that the countries of the north wanted to defer any decision regarding the instrument to June of next year and that, in any case, they wanted to incorporate the word “stabilization”. The French minister, Bruno Le Maire, struggled until the last moment with the Dutch Wopke Hoestra and found a formula by which the proposal does not die, but neither comes out ahead.
The document establishes that the Eurogroup discussed the proposals of the European Commission and France and Germany on “budget instruments” to “strengthen” the euro zone, which would be within the budget of the euro zone, and whose size is not known. With the mandate of the Summit of the Euro, adds the paper, you could start working on an instrument to ensure the competitiveness and convergence of countries. The conclusions also note that they discussed their role in stabilization, but adds that there is no agreement. “The technical discussions continue,” he adds.
Nothing has changed compared with before the Eurogroup. There are the same disagreements. European leaders, therefore, must decide next week whether to continue or not with the project. In the press conference after the Eurogroup, Rye, barely could move from the literal wording. “The works are still in progress,” said Rye. “You're not grounded,” added the commissioner of Economic and Monetary Affairs, Pierre Moscovici.