Opinion

Paul Taylor

Germany rebuffs EU call for more risk-sharing

Paul Taylor
Dec 14, 2012 14:37 UTC

BRUSSELS, Dec 14 (Reuters) – Germany rebuffed calls for more
financial risk-sharing in the euro zone on Friday, rejecting a
proposal for a fund to help debt-laden countries cope with
economic shocks and leaving open who would pay to wind down
stricken banks.

With an eye on a general election next year, Chancellor
Angela Merkel made EU officials drop any mention of a
shock-absorber fund, backed by France and southern European
states, from the conclusions of a two-day European Union summit.

She also resisted efforts by French President Francois
Hollande and Italy to loosen EU budget discipline rules by
exempting public investment when calculating national deficits.

The European Central Bank also rejected any let-out clauses
from fiscal consolidation.

“Differentiating between good and bad deficits makes no
sense,” ECB executive board member Joerg Asmussen told Reuters.
“Each deficit has to be refinanced on the capital markets. One
should not touch the rules of the (EU) Stability Pact.”

EU leaders promise further steps to quell crisis

Paul Taylor
Dec 14, 2012 02:34 UTC

BRUSSELS, Dec 13 (Reuters) – European leaders agreed to
press on with further steps to shore up their finances and
sustain momentum in tackling the debt crisis on Friday, a day
after clinching a deal on banking supervision and approving
long-delayed aid to Greece.

After more than eight hours of late-night talks at a summit
in Brussels, leaders promised to push ahead with setting up a
mechanism to wind down problem banks, although it was unclear
when the facility would be completed.

They also launched tentative discussions on how to make
countries stick to economic targets and on creating a
“solidarity fund” to help member states suffering one-off
economic shocks, but did not delve deeply into either issue,
pushing the debate out to the middle of next year.

Greece gets new EU aid, declares “Grexit” era dead

Paul Taylor
Dec 13, 2012 14:04 UTC

BRUSSELS, Dec 13 (Reuters) – The euro zone agreed on
Thursday to provide nearly 50 billion euros ($64 billion) in
long-delayed aid to Athens, prompting its Prime Minister Antonis
Samaras to declare an end to talk of a Greek exit from the
single currency.

The deal averts a catastrophic default and secures Greece’s
survival in the euro zone after months of doubt and political
turmoil. Athens had repeatedly missed fiscal targets agreed with
the EU and the International Monetary Fund, and stalled
structural economic reforms.

“We are convinced that the programme is back on a sound
track,” Jean-Claude Juncker, chairman of the 17-nation euro
area’s finance ministers told a news conference after they met
in Brussels ahead of an EU summit later in the day.

Franco-German chill reshuffles cards in Europe

Paul Taylor
Dec 10, 2012 10:02 UTC

PARIS (Reuters) – A chill has settled over the Rhine seven months after the election of Socialist French President Francois Hollande, reshuffling the cards in Europe’s perpetual power game.

The cooling of traditionally close Franco-German relations was partly an intentional step by Hollande to demonstrate that he is not in conservative Chancellor Angela Merkel’s pocket but wants to change the policy direction of the European Union.

It also reflects a fraught process of rebalancing power to accommodate Germany’s greater political heft and economic clout.

Analysis: Franco-German chill reshuffles cards in Europe

Paul Taylor
Dec 10, 2012 06:58 UTC

PARIS (Reuters) – A chill has settled over the Rhine seven months after the election of Socialist French President Francois Hollande, reshuffling the cards in Europe’s perpetual power game.

The cooling of traditionally close Franco-German relations was partly an intentional step by Hollande to demonstrate that he is not in conservative Chancellor Angela Merkel’s pocket but wants to change the policy direction of the European Union.

It also reflects a fraught process of rebalancing power to accommodate Germany’s greater political heft and economic clout.

Wanted: A bridge-builder for the euro zone

Paul Taylor
Dec 5, 2012 19:04 UTC

PARIS, Dec 5 (Reuters) – The hunt is on for a competent,
articulate consensus-builder to succeed veteran Luxembourg Prime
Minister Jean-Claude Juncker as chairman of euro zone finance
ministers and help the currency bloc to emerge from crisis.

Juncker, 57, who has held the job since 2005 and has been a
leading protagonist in Europe’s monetary union ever since the
1991 Maastricht treaty, said on Monday he would step down as
Eurogroup chief at the end of the year or early next year.

His announcement set off a scramble to find a figure
acceptable both to fiscally conservative north European
AAA-rated states and to southern countries struggling to rein in
debts and deficits and regain economic competitiveness.

Greek deal puts euro zone in slow recovery room

Paul Taylor
Dec 2, 2012 10:06 UTC

PARIS (Reuters) – The euro zone is in the recovery room now the danger of a Greek default has been averted for a couple of years, but it is not yet safe from a Japanese-style “lost decade”.

The currency area’s escape route hinges more on the pace of expansion in the United States and China, lifting the world economy, than on the policy mix in Europe, which will continue to favour austerity over growth in 2013.

At best, Ireland and Portugal could emerge slimmed down from their bailout programmes and regain capital market access by the end of the year, demonstrating that adherence to a tough fiscal adjustment plan can work.

Analysis: Greek deal puts euro zone in slow recovery room

Paul Taylor
Dec 2, 2012 09:42 UTC

PARIS (Reuters) – The euro zone is in the recovery room now the danger of a Greek default has been averted for a couple of years, but it is not yet safe from a Japanese-style “lost decade”.

The currency area’s escape route hinges more on the pace of expansion in the United States and China, lifting the world economy, than on the policy mix in Europe, which will continue to favour austerity over growth in 2013.

At best, Ireland and Portugal could emerge slimmed down from their bailout programmes and regain capital market access by the end of the year, demonstrating that adherence to a tough fiscal adjustment plan can work.

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