The Eurogroup managed to save the furniture at the last moment and take a minimum agreement to the reform of the euro. They were about to go home with their pockets empty. But after 15 hours of talks, European finance ministers tied the creation of a security network for bank failures and the reform of the rescue fund (Mede) and a sort of agreement on the disagreement: The Franco-German budget proposal for the area euro is still alive, but with a no lesser addendum: the partners of the single currency did not achieve a "common vision" about the "need" and the "design" of an instrument that would stabilize the euro zone in times of crisis.
The ministers had a year and a half with these issues on the agenda. In the case of fiscal support for the rescue fund, the agreement was in principle closed. And yesterday afternoon, the reform of the Mede was practically the same. But about ten o'clock at night everything fell apart. Italy protested the conditions that were introduced in the debt restructurings within the changes of the rescue fund; France claimed angered by the budget of the euro zone; Germany incorporated European unemployment insurance, and the Netherlands was opposed to any proposal that would lead to a "stabilization" of the euro zone.
The negotiators considered to suspend the meeting and to summon another Eurogroup for the week that comes, to scarce days of the Summit the Euro, according to diplomatic sources. At seven-thirty in the afternoon, after several recesses, bilateral meetings and calls, an agreement was reached. Finally, two legs of the Banking Union were closed: a bank resolution fund and the reform of the Mede, which will include funds for countries facing specific crises and collective action clauses, by which a majority of investors can agree and impose rest the conditions of a restructuring. In contrast, the ministers were unable to move forward in the community deposit guarantee fund. The head of the Eurogroup, Mário Centeno, certified after the meeting that it is still "difficult" to advance in this area.
Budget ran aground
The conversation was once again stalled in the euro zone budget and community unemployment insurance, which the German minister Olaf Scholz managed to filter into the final document. Diplomatic sources explain that the northern countries wanted to postpone any decision on that instrument to June of next year and, in any case, did not want to incorporate the word "stabilization". The French minister, Bruno Le Maire, battled until the last moment with the Dutchman Wopke Hoestra and found a formula by which the proposal does not die but does not go ahead either.
The document states that the Eurogroup discussed the proposals of the European Commission and France and Germany on "budgetary instruments" to "strengthen" the euro zone, which would be within the budget of the euro zone and whose size is not known. With the mandate of the Euro Summit, add the role, you could start working on an instrument to ensure the competitiveness and convergence of countries. The conclusions also indicate that its stabilization function was discussed, but adds that there is no agreement there. "Technical discussions continue," he adds.
Nothing has changed compared to before the Eurogroup. There are the same disagreements. European leaders, then, must decide next week whether or not to continue with the project. In the press conference after the Eurogroup, Centeno could hardly move from the literality of the redacted one. "The works are still in progress," said Centeno. "It is not cemented," added the Commissioner of Economic and Monetary Affairs, Pierre Moscovici.