Finance Minister pushes for EU fiscal union
The Local · 16 Oct 2012, 17:59
Published: 16 Oct 2012 17:59 GMT+02:00
According to the Handelsblatt newspaper, Chancellor Angela Merkel and Finance Minister Wolfgang Schäuble want their European partners to embrace the idea of a "fiscal union."
On his return from a five-day trip to Asia, Schäuble said it was time to take "bigger steps" in that direction - which would also entail "changing European treaties in one place or another."
The finance minister's call comes just ahead of a key EU summit set to start on Thursday.
During his visit to Singapore, Schäuble dismissed speculation of a Greek exit from the eurozone, saying he did not believe Athens would go bankrupt.
Yet preliminary estimates by the "troika" of Greece's international creditors - the European Commission, European Central Bank and International Monetary Fund - point to a grim picture.
Last month, news magazine Der Spiegel said troika experts estimated that Athens was facing a budget shortfall of about €20 billion.
Handelsblatt said Berlin was prepared to work toward a solution on the Greek issue - but EU treaty reform would be the price Germany demanded for those efforts.
More than anything, the German finance minister is looking to give a European currency commissioner the power to reject budget plans that conceivably violate the EU fiscal pact - and force those countries to go back to the drawing board.
Under current rules, the EU Commissioner for Economic and Monetary Affairs, Olli Rehn, can only recommend that a country rework its budget with other EU commissioners' backing. Schäuble wants the bloc's money chief to have more authority - though a country's legislature would decide whether to address the budget shortfall through tax hikes or savings.
But a spokeswoman for European Commission President José Manuel Barroso said Tuesday that Rehn already plays an important role and enjoys "much respect."