22nd Oct 2020

No fresh move from eurozone finance ministers

  • Mr Juncker, chair of the eurogroup, did not win the day in his call for E-bonds (Photo:

After a five-hour meeting of finance ministers in Brussels from states using the euro currency with nothing to show for it, all eyes are sharply focussed on what the markets will make of the eurozone's immobility.

Despite urgent calls from some quarters to hike the ceiling of the euro area's rescue fund and even for the European Union to begin issuing its own bonds as speculation mounts of a break-up of the euro, ministers from 16 states came to no conclusions.

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"We don't have any new decision to announce to you," Luxemburgish Prime Minister, finance minister and chair of the Eurogroup, Jean-Claude Juncker, told reporters in the European capital.

The same day however, Mr Juncker and the Italian finance minister, Giulio Tremonti, had written in the Financial Times that Europe must begin issuing a common debt offering, or euro-bond.

"Europe must formulate a strong and systemic response to the crisis, to send a clear message to global markets and European citizens of our political commitment to economic and monetary union, and the irreversibility of the euro." they had said.

"This can be achieved by launching E-bonds, or European sovereign bonds, issued by a European Debt Agency (EDA) as successor to the current European Financial Stability Facility," they continued.

"Time is of the essence."

However, it only took hours for German Chancellor Angela Merkel to shoot down the idea, insisting that the European treaties would not allow such a move.

"Interest rates are an incentive to become better and meet the requirements of the Stability and Growth Pact," she said,

It is thought that the Netherlands is backing Germany in blocking the idea.

The two powers also oppose an increase to the rescue fund.

A wider meeting of the EU's 27 finance ministers will meet on Tuesday.

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EU budget talks suspended in fight for new funds

MEPs are requesting additional, new funding of €39bn for 15 EU programs. The German presidency argues that budget ceilings, agreed by EU leaders at a marathon summit in July, will be impossible to change without a new leaders' meeting.

EU countries stuck on rule of law-budget link

Divisions among EU governments remain between those who want to suspend EU funds if rule of law is not respected, and those who want to narrow down conditionality.

MEPs warn of 'significant gaps' in budget talks

The budget committee chair said the European Parliament expects tangible improvements to the package in its talks with member states - while the German minister argued that the EU leaders' deal was difficult enough.

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