The EU have paved the way for the creation of permanent relief mechanism

The EU have paved the way for the creation of permanent relief mechanism

EU summit in winter from 16 to 17 in Brussels. In the first day of the meeting, the EU-27 leaders to modify the "Lisbon Treaty" agreement.

The leaders decided to "Lisbon Treaty" in paragraph 136 to add two things: the creation of the euro zone will be a permanent member of the rescue mechanism, used to maintain the stability of the euro area; of the members will accept the additional aid strict conditions. Member States will be before the end of 2012 the revised "Lisbon Treaty" signed a new treaty at the latest from January 1, 2013 come into effect.

The leaders of the "Lisbon Treaty" to do a "minimal" modification, first to avoid some Member States lead to trouble when the ratification of the treaty. If change is too large, involves the transfer of power to the EU member states, then, like Ireland, Britain and other countries must use a referendum to ratify the new treaty the way, this will bring a lot of trouble, and even make the revised Treaty of mortality ; the second is to ensure that member states can agree on this summit to calm market concerns about the outlook for the euro. The more simple because the content changes, the more easy to obtain the agreement of 27 countries.

"Lisbon Treaty" for the above amendments, the establishment of a permanent mechanism to have a legal basis for relief. Greek debt crisis, the European Union in May this year, created a total of 7,500 billion euros of temporary relief mechanism for the "problem countries" to provide assistance, the temporary relief mechanism will expire in June 2013. Temporary relief in the euro area member states decided to establish a permanent mechanism for relief after the expiration mechanism, designed to maintain long-term stability of the euro.

Modify the treaty in the end of the discussion at a news conference, President of the Council of Europe, said Van Rompuy, the market will never again doubt the euro EU leaders to maintain the political will and strong determination. European Commission President Jose Manuel Barroso said the leaders made a major decision, as is a unanimously agreed to amend the Treaty extremely difficult thing.

Modify the "Lisbon Treaty" is the debt crisis of the summit the only formal issues. Van Rompuy said the general principle of operation of a permanent mechanism will be adopted by EU finance ministers late last month, the principle of development, require the assumption of debt crisis, private investors with the risk and losses will be in June 2013 after a case by case treatment. But according to reports, the countries in the permanent relief mechanism operates there are still differences. Germany put forward: First, to the "problem countries" to obtain relief and the implementation of strict fiscal policy hook; Second, one must force the banks and private investors and taxpayers with the debt crisis of the risk and bear the loss, "national" Once the debt breach of contract, will allow it to restructure its debt, or to private investors "barber", that is to devalue the national debt they hold.

The modified "Lisbon Treaty", the leaders before the summit have reached a consensus, so this results in the media expected. Public are more concerned about another three issues: first is the permanent relief mechanism will work? The second issue is whether to expand the scale of rescue mechanism? The third issue is whether the euro issue joint debt? In these 3 issues, serious differences between member states. In anticipation of the countries of this summit can not reach agreement on these issues, these issues are not included in the summit's formal agenda. At a news conference to answer a reporter's question Rompuy only in general terms, there is no need to increase the size of relief mechanism. But he said that the EU will take all necessary measures to safeguard the stability of the euro. Analysts believe that unhealthy in the banking sector, borrowing costs are high, weak economic growth, such as Greece, Ireland, Portugal, the country's finances are not sustainable in the near future is likely to default. To avoid deterioration of the debt crisis, these issues must answer sooner or later.

In order to market confidence, the media, EU leaders unanimously said that the EU has the ability, confidence and a common will to maintain the stability of the euro. German Chancellor Angela Merkel walked he said: "We have a common goal, this goal is: the EU and the stability of a stable euro." Rompuy at a news conference that the determination of EU leaders is clear and firm, the market should not doubt their political will. In addition to before the summit, the European Central Bank announced that it would eurozone central banks of Member States to the European central bank the total capital subscribed by 5.76 billion euros from the current increase of almost nearly doubled. This is a 12-year history of the European Central Bank for the first time requires Member States to the European Central Bank to increase capital injection. Verified in this regard the seriousness of the debt crisis, on the other hand indicates that the ECB will continue to buy "problem countries" national debt.

However, the market does not seem to appreciate this. 16 That day, the Bank of Spain issued in the financial market is 2.4 billion euros of debt, of which 1.8 billion for the 10-year bonds, the average interest rate of 5.4% over the November 18 issue of the 10-year bond interest rate higher than 4.6% many. In addition, the same day, European stock markets and foreign exchange on the summit of the response is relatively flat.

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