Thursday

19th Sep 2019

EU commission to present eurobonds plans next week

  • Integration is the only solution, say EU presidents (Photo: Council of European Union)

In a bid to stem the tide of the debt crisis engulfing the eurozone, the twin leaders of the European Union, Herman van Rompuy and Jose Manuel Barroso, have announced plans for further integration.

“We are now facing a truly systemic crisis. It has made it clear that we must progress with greater integration of economic governance, especially within the euro area” Barroso, President of the European Commission, told the European Parliament on Wednesday (16 November).

Read and decide

Join EUobserver today

Support quality EU news

Get instant access to all articles — and 18 year's of archives. 30 days free trial.

... or join as a group

He said he would present plans next week “for the joint issuance of bonds in the euro area”. “I believe that Euro stability bonds will be seen as natural when we achieve our goal of reinforced governance and of course discipline and convergence,” he said.

EU Council President Van Rompuy, meanwhile, told parliament that the current crisis leaves the members of the eurozone with no choice.

“The crisis in the euro area does require us to do more. We need to acknowledge that this means a sharing of sovereignty for all members of the euro zone, and not only a loss for the countries in difficulty,” he said.

He also said that euro zone governments should look at strengthening the role of automatic sanctions for countries that break fiscal rules, "such as a suspension of voting rights or the suspension of structural funds or other payments."

Also, he asked out loud, "should we provide power for a central authority to intervene in national budgetary procedures?"

He said he would present an interim report next month with "a roadmap on how to proceed". A finalised report will then be presented in May or June next year.

He further dismissed worries, voiced most loudly by the UK but echoed by those outside the eurozone, that closer integration within would cause a two-tier Europe.

“There has been much exaggerated talk about this,” he said. “It is time to de-dramatize this debate. After all, it is perfectly natural that those who share a common currency take some decisions together.”

“It is in the interest of the non eurozone EU members that its financial stability is organized and secured. A better structured euro area is in everybody’s interest,” he added.

For Guy Verhofstadt, leader of the liberal group in parliament and longtime advocate of joint eurobonds, the proposals did not go far enough.

“The euro zone crisis has reached a very dangerous point. We are now witnessing increasing spreads on interest rates between national sovereign bonds and the benchmark German bund even for countries with a AAA credit rating. Nothing less than full economic and fiscal union including euro bonds will do,” he said.

Agenda

This WEEK in the European Union

Economic governance of the eurozone comes once more on the agenda this week, as the European Commission will put forward the proposal of creating eurobonds, despite German resistance.

Brussels sees no serious opposition to eurobonds

The European Commission has launched a polemic on eurobonds - a proposal that eurozone countries should guarantee one another's debt, taking member states into uncharted territory in terms of solidarity and trust.

Rehn backs 'smart' mutual debt fund

The idea of mutualising eurozone debt remains as controversial as ever but economic affairs commissioner Olli Rehn has spoken out in favour of a halfway house solution.

News in Brief

  1. Austria to veto EU trade deal with South America
  2. Brexit minister asks EU for 'flexibility' to secure a deal
  3. Kovesi has 'sufficient majority' for prosecutor post
  4. France, Finland give UK ultimatum for Brexit plan
  5. Minsk talks bode ill for EU's peace summit on Ukraine
  6. Poll: Poland's nationalist rulers to win October election
  7. Irish lawyers clash with EU commission in Apple case
  8. NGOs take aim at EU smartphone pollution

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 MinistersNew programme studies infectious diseases and antibiotic resistance
  2. UNESDAUNESDA reduces added sugars 11.9% between 2015-2017
  3. International Partnership for Human RightsEU-Uzbekistan Human Rights Dialogue: EU to raise key fundamental rights issues
  4. Nordic Council of MinistersNo evidence that social media are harmful to young people
  5. Nordic Council of MinistersCanada to host the joint Nordic cultural initiative 2021
  6. Vote for the EU Sutainable Energy AwardsCast your vote for your favourite EUSEW Award finalist. You choose the winner of 2019 Citizen’s Award.
  7. Nordic Council of MinistersEducation gets refugees into work
  8. Counter BalanceSign the petition to help reform the EU’s Bank
  9. UNICEFChild rights organisations encourage candidates for EU elections to become Child Rights Champions
  10. UNESDAUNESDA Outlines 2019-2024 Aspirations: Sustainability, Responsibility, Competitiveness
  11. Counter BalanceRecord citizens’ input to EU bank’s consultation calls on EIB to abandon fossil fuels
  12. International Partnership for Human RightsAnnual EU-Turkmenistan Human Rights Dialogue takes place in Ashgabat

Latest News

  1. Malta PM accused of 'blackmail' over slain reporter
  2. Diplomats back Romania's Kovesi for EU top prosecutor
  3. Brexit raises questions for EU defence integration
  4. Low-carbon cities can unlock €21tn by 2050, report finds
  5. France, Italy want 'automatic' distribution of migrants
  6. Europe's refugee policy is test of its true 'way of life'
  7. A new Commission for the one percent
  8. Juncker: No-deal Brexit 'palpable'

Join EUobserver

Support quality EU news

Join us