Following yesterdays EU Brussels summit, 25 EU member states have agreed in principal to come together on a fiscal treaty to enforce European budget discipline in a brave attempt to ward off future debt crisis.
Only 2 EU members refused to signup, the UK and Czech Republic. In Britain the PM was quoted “my government would act if the treaty threatened UK interests” following up with justification for refusing to add his signature, that he has “legal concerns” regarding the the use of the EU and it’s many institutions to enforce the fiscal treaty. In the Czech Republic, no formal statement was offered however Nicolas Sarkosy, French President said the Czechs cited “constitutional reasons” as their reason to refuse to sign up
The intention of the fiscal treaty is to attempt to co-ordinate budget policies across all EU member states to ensure that int he future debts crisis are prevented from materializing as excessive debts will not be allowed to accumulate.
Angela Merkel, President of Germany which in recent years has become recognized as the EU’s largest financial lender and subsequently has taken on the mantel as the most powerful economy in te EU has been the champion of the fiscal treaty and focused on ensuring a binding treaty is ratified accross the member states to attempt to control and manage budget rules.
Finer details of the treaty outlined that power of the European Court of Justice to implement and track compliance of all member states with the power to impose fines when clauses are breached. The European Commission is also empowered to enforce national budget transparancy with the ability to request and investigate where it deems warranted.
During the summit, EU leaders covered additional hot economic topics including the lack of progress on the Greek economic restructuring plan and reduction of unemployment accross all 27 EU member states. Combined, the summit aimed to identify and agree methods to stiumlate economic growth in a climate of austerity budgets being implemented accross the EU.
