BERLIN (MNI) – German Chancellor Angela Merkel said on Friday that
it makes perfect sense for the future European Stability Mechanism (ESM)
to foresee a private sector involvement.
“There exist very good reasons why we decided to introduce
collective action clauses” into future government bonds of Eurozone
member states once the ESM has been implemented, Merkel said at a joint
press conference with Austrian Chancellor Werner Faymann.
Yet, Merkel acknowledged that there were still discussions underway
on the European level regarding the final shape of the ESM.
Merkel again called for making the Eurozone a stability union by
shifting more national budget sovereignty to the European level,
something which requires a change of the EU treaties.
Faymann noted that a limited transfer of budget sovereignty would
not require a referendum in Austria, but cautioned that a more
far-reaching transfer would.
Merkel said her plans would not require a change in the German
constitution.
Asked about the possibility of issuing joint eurobonds in the
Eurozone, Faymann reasoned that “if the fundament is more solid, more
people will be willing to take risks.”
–Berlin bureau: +49-30-22 62 05 80; email: twidder@marketnews.com
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