Merkel and Hollande call for full-time euro President

One day after he rejected EU “dictates” on economic policy, French leader Francois Hollande and Germany’s Angela Merkel have called for the creation of a full-time euro “President.”

The idea came in a joint

The paper says that “a full-time President for the Eurogroup of finance ministers relying on wider resources” should be created after the EU elections in 2014.

It calls for: more frequent eurozone summits; a “specific fund for the euro area” alongside the general EU budget; and new “structures” in the European Parliament to oversee euro-level economic governance.

It says eurozone countries should sign binding contracts on economic reform with EU institutions.

It also makes a number of concessions on French concerns.

It says that a new resolution mechanism for failed banks “should be established on the basis of the current [EU] treaties.”

It calls for €6 billion of EU spending on youth unemployment to be “front-loaded” in the first two years of the 2014 to 2020 EU budget. It also says the EU should co-ordinate “minimum wage floors” to keep workers out of poverty.

Meanwhile, a 50-minute-long Merkel-Hollande press conference at the Elysee palace was punctuated by a moment of hilarity.

At one point, the German Chancellor said “the issues on which we are working have been discussed by [former French leader] Francois Mitterand,” before correcting herself to say: “Francois Hollande, not Francois Mitterand. Francois Hollande.”

The meeting tried to make a show of good Franco-German relations following a series of Hollande-Merkel disagreements.

Hollande said: “Everyone says we don’t agree. Most of the time we do agree. There are nuances, but you [the press] emphasise those nuances.”

Merkel’s remarks showed that gripes remain, however.

In the context job security laws in France, she said: “We reformed our labour markets … We put flexibility into labour law. Is it better for a young person to have a job with a certain flexibility? Or no job at all?”

She also noted that the European Commission’s recent decision to give France extra time to cut its deficit comes with strings attached: “It is tied to the fact that reforms will be undertaken … I cannot put in place a system of solidarity in Europe and then everyone does their own budgets.”

Despite the new paper on euro governance, Hollande on Wednesday had said Brussels has no right to “dictate” economic reforms.

He said on Thursday that “nothing is taboo. All the reforms that have to be undertaken will be done.”

But he added that: “The details, procedures and way of going about this are the responsibility of the government and the state, otherwise there would be no national sovereignty.”

Some top people in Merkel’s CDU party were less gentle than the German Chancellor in Paris.

CDU deputy chairman Andreas Schockenhoff told German media that Hollande’s attitude: “contradicts the spirit and letter of European agreements and treaties. Someone who talks like that is shaking the foundations of the EU.”

He added: “Hollande’s severe reaction shows the considerable desperation that, one year after coming to power, his government has still not found effective answers to the economic and fiscal problems of their country.”

CDU deputy speaker Michael Fuchs noted: “It [EU-level governance] can’t work when a big country like France says it can do what it wants.”

Referring to the commission’s extra time on the French deficit, the CDU’s budgets spokesman, Norbert Barthle, said: “France won’t be able to bank on such indulgence again.”

Hollande and Merkel on Thursday also visited an exhibition at the Louvre museum to mark 50 years of Franco-German unity.

Merkel said the paintings are “very beautiful.”

But the display itself has become a minor irritant.

Some of the pictures – such as the Hell of Birds by Max Beckmann, which depicts a four-breasted female monster doing a Nazi salute – have attracted angry comment in German newspapers.

Die Zeit in April called the exhibition a “cultural-political scandal,” while Frankfurter Allgemeine Zeitung said it “confirms all the cliches of the estranged, romantic, dangerous and dark neighbour.”

Πηγή: EUObserver