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Merkel and Cameron - fiscal pact not enough
Photo: DPA

Merkel and Cameron - fiscal pact not enough

Published: 07 Jun 2012 16:40 GMT+02:00
Updated: 07 Jun 2012 16:40 GMT+02:00

German Chancellor Angela Merkel and British Prime Minister David Cameron agreed on Thursday that the EU's fiscal pact was not enough in itself to resolve the crippling eurozone debt crisis.

In a short news conference after talks in Berlin, Merkel said the pact, which aims to toughen budgetary discipline in the EU, was "necessary but not the only precondition" to stem more than two years of turbulence.

For his part, Cameron added that the fiscal pact, which non-euro Britain has not signed, was "important but not sufficient" to pull the eurozone out of its malaise.

Merkel said that looking further out, the eurozone need to pool sovereignty in areas other than tax and spending if such crises were to be prevented from happening again.

"When we look at the medium and longer term, we need more coherence, not just in terms of fiscal policy, but also in other areas ... (the fiscal pact) is a necessary step, but not sufficient," she added.

Twenty-five of the European Union's 27 member states have signed up to the fiscal pact.

Merkel added that she wanted to see "certain parameters" within the eurozone harmonised.

"For example, when one country spends nothing on research and other spends three percent of its gross domestic product; that cannot work in the long term," the chancellor said.

"The responsibility of being in a common currency brings other duties with it. This is shown in the fiscal pact but it does not call into question the togetherness of the whole EU 27," she insisted.

Speaking at a meeting of students earlier in the day, Merkel had reiterated that there was no one magic solution that would cure the eurozone's ailments.

"Calling for this one big bold stroke and then the euro crisis will be gone. This won't work," she insisted.

"These problems have piled up over many years and now it will take some while to render this system fit for the future. It's obviously in human nature to wish for this bold stroke but I don't think it will work," she added.

AFP/hc

The Local (news@thelocal.de)

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Your comments about this article

17:15 June 7, 2012 by Englishted
Hot air and no action whats new.
09:58 June 8, 2012 by mos101392
Until Cameron throws away the pound and adopts the Euro. he really doesn't have a say in all of this. However, I give him cudos for having the guts to tell Merkal to do as he says and not as he does.

If the UK can keep their Pound and still call themselves European, then the Germans should bring back the DM and let the rest fend for themselves. There seems to be allot of anger towards Germany, another reason to bring back the DM. At least they would no longer have to carry Europe's burden while at the same time listen to all their anti German complaining.

Europe will never become a single country, and until that happens, a single currency will have it's problems. Europe is simply too diverse with languages and cultures.

There will always be the "slackers" and the "over achievers".
10:40 June 8, 2012 by McM
The Euro zone has a solvency problem and wether GB is in or out of the zone is sadly not relevant. Scapegoats are easy to find, considered solutions, not so easy.

A lot of smart money has long departed Euro zone member countries including Germany. London can assist and compliment as a Union member by encouraging the bankers there to participate but don't hold your breath, the A league investors are no longer playing in the euro zone. European countries are geographic partners not just currency partners and all regional members have an obligation to assist .

Whether or not the knee jerk reactionaries and free lunch lobbies win the day , there will still remain a fundamental issue with keeping the zone solvent. Luckily Germany and Briton still have some say in it .
16:01 June 8, 2012 by kyanfar
Unfortunately GB has always something to whinge about, especially in some matters that do not have to do anything with it. David Cameron says: "I wouldn't ask British taxpayers to stand behind the Greek or Spanish deposits. It is not our currency, so that would be inappropriate to do. http://www.huffingtonpost.co.uk/2012/06/07/david-cameron-british-taxpayers-will-not-rescue-greek-and-spanish-banks_n_1577937.html?ref=uk" However, on the other hand, he pushes for more Germany action over eurozone crisis: "http://www.guardian.co.uk/politics/2011/nov/08/david-cameron-pushes-for-more-german-action".

He knows better than anyone that GB's economy depends on the Eurozone's economy.

I would like to see what he would have said or say if UK was the one in the position of Greece is today?

Would he think that is inappropriate for Eurozone Taxpayers to help GB?

We should leave it to the future when it really happens.
20:18 June 8, 2012 by agc55
I think Cameron needs to be more constructive and stop playing to the voters in the UK. That said I do think the UK PM has the right to comment. If the person next door's house in on fire and it threatens your home you would not expect him to say its non of your business let it burn and it may also burn down your house. But maybe Cameron should help put the fire out instead of having a BBQ.
22:00 June 8, 2012 by avatar009
hi,

The realty iz the EU, must deal the corruption in the Southern Area. They must figure out the yearly GDP out put. The problem isnt Cameron is Global financial crisis start the credit crunch. It all comes to corruption and EU dont like to talk about that.
06:14 June 9, 2012 by agc55
Yes I agree avatar009 that this is at the heart of the problem, but without apportioning blame the rush to expand the Euro Zone was blind to these risks. I wouldn't totally agree the credit crunch started the crisis but it did expose a time bomb ticking away, a time bomb which would have exploded sooner or later. In times of crisis national interests will always take priority in democratic nations and that is the Achilles heal of the EU. The even greater danger is that if governments don't listen to the people they are elected out and this opens the door to the extremists and fools. I don't see an answer but we need to work together.
11:11 June 10, 2012 by blackboot11
In other news as Merkel and her ministers voted themselves a pay raise....

"Seeking to set the example ahead of the parliamentary vote, Hollande and his ministers agreed in May to cut their salaries by 30 percent." today on Reuters.com
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