Sunday

26th Jan 2020

EU to hold second summit next week

European leaders are to have a second summit on the eurozone crisis, most likely on Wednesday (26 October), amid Franco-German discord on a series of key issues to do with solving the single currency's problems.

A joint statement by Paris and Berlin, released late Thursday evening, said that all the elements of the planned "global and ambitious response" to the eurozone crisis would be examined in a "profound manner" on Sunday.

Read and decide

Join EUobserver today

Support quality EU news

Get instant access to all articles — and 20 years of archives. 14-day free trial.

... or join as a group

Decisions, however, will only be taken "during the second meeting at the latest on Wednesday."

The two-step approach - which runs the risk of turning the Sunday meeting into a damp squib gathering - comes after deep disagreement between Paris and Berlin on several fronts, including on how to provide sufficient additional resources to the eurozone bailout fund to stop contagion spreading to Italy; how to recapitalise European lenders and the extent to which private investors should be forced to write down Greek debt.

In their statement, President Nicolas Sarkozy and Chancellor Angela Merkel said that the "response" to the crisis would include the "operational implementation" of the recently-boosted bailout fund, the European Financial Stability Facility (now able to inject capital into banks and purchase bonds); a plan to increase the capital of European banks and strengthening economic governance in the eurozone.

However, there is no mention of increasing the firepower of the bailout fund nor of how to deal with Greek debt.

Recent days have exposed profound differences between the two sides on how to deal with the two issues. France, whose banks are greatly exposed in Greece, has been reluctant to accept a push by Germany that private investors take a 50-60% haircut on Greek debt.

Meanwhile Germany has been opposed to France's idea to link the EFSF to the European Central Bank, which would theoretically give it an unlimited supply of money.

In addition, disagreements have stretched the self-imposed timetable of finding a solution to all of these problems during Sunday's summit to breaking point.

It meant that Chancellor Merkel was unable to present plans to the parliament before heading to Brussels, a requirement recently laid down by the country's highest court.

The extra days give the chancellor time to talk to German MPs, many of whom are strongly sceptical about recent moves to help troubled eurozone countries.

"EU summit to be held in two stages. Sunday deliberations. Decisions next week. Sufficient parliamentary participation possible in this way," German government spokersperson Steffen Seibert tweeted Thursday.

Summit will not be end of eurozone's troubles, says Barroso

In a reminder to jittery markets about how difficult decisions for the eurozone don't just need to be taken but also implemented, European Commission president Barroso has said Sunday's summit will not necessarily draw a line under the eurozone's crisis.

EU summit delayed as France, Germany tussle

European Council President Herman van Rompuy has delayed by a week a planned summit of the bloc’s leaders in order to give more time for behind-the-scenes negotiations on plans to end the eurozone crisis.

Agenda

This WEEK in the European Union

Billed by the G20 last week as the summit to save the euro, EU leaders will in Brussels on Sunday try to bridge divisions between Germany and France on how to stop Greece and Italy from sinking the single currency.

News in Brief

  1. Catalan premier refuses to step down, despite ruling
  2. UK set to support new fossil fuel projects in Africa
  3. Leftists MEPs travel to visit jailed Catalan MEP
  4. Bulgaria may expel Russian diplomats over 'espionage'
  5. EU, China, others agree on WTO body to settle disputes
  6. EU Commission makes move against Poland on judges law
  7. Soros pledges $1bn for liberal universities
  8. Merkel: Germany unprepared for 2015 refugee crisis

Feature

Promises and doubts: Africa's free-trade adventure

The EU is hoping that a continent-wide free trade agreement in Africa will help lift millions out of poverty and help solve issues of security and migration. But its message of values and equal partnership do not resonate with everyone.

Opinion

Why von der Leyen must put rights at core of business

Ursula von der Leyen's in-tray must include those European executives on trial for systematic workplace harassment, the break-up of European slavery rings, and allegations of European companies' abuse in palm oil, including child labour, land grabs, and deforestation.

Stakeholders' Highlights

  1. Nordic Council of Ministers40 years of experience have proven its point: Sustainable financing actually works
  2. Nordic Council of MinistersNordic and Baltic ministers paving the way for 5G in the region
  3. Nordic Council of MinistersEarmarked paternity leave – an effective way to change norms
  4. Nordic Council of MinistersNordic Climate Action Weeks in December
  5. UNESDAUNESDA welcomes Nicholas Hodac as new Director General
  6. Nordic Council of MinistersBrussels welcomes Nordic culture

Latest News

  1. AI must have human oversight, MEPs recommend
  2. Second-hand cars flaw in EU Green Deal
  3. Why do EU arms end up in Libya despite UN ban?
  4. Brexit deal to be signed, as sides poised for tough talks
  5. Timmermans urges EU governments to tax carbon
  6. Vietnam sent champagne to MEPs ahead of trade vote
  7. China spy suspect had EU permission to work as lobbyist
  8. EU to unveil 5G 'toolbox' to tackle security threats

Join EUobserver

Support quality EU news

Join us