Eurozone four leaders, German, France, Italy and Spain, sat together to discuss measures to boost Euro growth equal to 1% of the currency area’s economic output. The leaders met in Rome ahead of an EU summit on the euro crisis next week.
The leaders outlined plans to push for a 130bn-euros package. The package comprises of several measures to boost spending on infrastructure and other investments, backed by European taxpayer money:
- Increasing the capital of the European Investment Bank by 10bn euros, which would enable the EU government-backed institution to increase its lending capacity by several times that amount;
- Fully deploying unused money in the European Commission’s regional funds;
- The creation of pan-European “project bonds” – common debts used to finance specific investment projects such as the construction of pan-european transport networks.
The agreement may be favorable for the recently elected French president, who has demanded a growth pact opposed by his counterpart Germany.
Another of the French President’s election pledge was to push for a pan-European tax on financial transactions-also known as a Tobin tax- which was agreed upon by the four leaders.
The leaders also sought to agree other proposals on closer integration – including a banking union and a financial transactions tax – to be put forward at the broader EU summit.
The idea is opposed by the UK government, who says it would hurt the City of London unless the tax were also implemented in other non-European international financial centers, as well as by Sweden.
However, after the two hour meeting they did not come to an agreement on the Eurobond decision.
No agreement was reached on the idea of eurobonds – common eurozone government debts, which have been opposed, at least in the near term, by Germany.
Mr Hollande reasserted his support for the idea, saying “I consider eurobonds to be an option… and not in 10 years” – an implicit criticism of German Chancellor Merkel’s position.