The leaders of the two most powerful economies in Europe are calling for a tougher and stricter European Union (EU) treaty in order to more effectively deal with the ongoing Euro zone debt crisis and avoid similar problems in the future.
After holding crisis talks in Paris, German Chancellor Angela Merkel and French President Nicolas Sarkozy warned that Europe could not continue on the same path.
Sarkozy insisted that new a treaty is required to make clear to the peoples of Europe, members of Europe and members of the euro zone, that things cannot continue as they are.
Merkel said France and Germany are demanding structural changes which go beyond agreements.
Under such a revised treaty member nations would be required to undergo closer scrutiny on their budgets and be subject to harsher sanctions in the event they ran up deficits above the 3 percent of GDP mandate by the Euro zone.
This package shows that we are absolutely determined to keep the euro as a stable currency and as an important contributor to European stability, said Merkel at a press conference in Paris.
Sarkozy and Merkel said they hope to submit their proposals to European Council president Herman van Rompuy on Wednesday.
At a press conference in Paris, Sarkozy defended a tougher treaty: “It's a strategic choice, it's an historic choice. It's the friendship between France and Germany that determined this. For the past 79 years we have peace, how would you like the future to be? We hope that every constitution from all the 17 countries of the euro zone have a golden rule on deficit that delegates equilibrium and balance. We should recover growth and for that we have decided to go a long way, to start a long journey together, for the future.”
Separately, Sarkozy and Merkel have both rejected the creation of “Eurobonds” (bonds of a single currency) as a way to alleviate the debt crisis.
How can we convince others to make the efforts we are making ourselves if we pool our debts as of now? Sarkozy countered,
None of this makes any sense.