EU summit: tug-of-war between austerity and growth measures

Monti wants flexibility, as do France, Spain and Portugal

14 March, 20:02

European Council Summit European Council Summit

(ANSAmed) - BRUSSELS - On arriving at the EU summit which began Thursday afternoon in Brussels, former Eurogroup president Jean-Claude Juncker said that he did not believe Italy would need a bailout any time soon.

On the issue of Cyprus, one of the items on the agenda of the summit which will continue Friday, Juncker ruled out a bailout plan similar to the Greek one with private sector involvement. ''I am among those who do not want to undertake a second operation like the one in Greece,'' the Luxembourg prime minister said, underscoring that when the 'haircut' was decided on Greek bonds in private hands ''we said that it was an exception, not that Greek-speaking countries were an exception''. ''I have only been in the government for 15 days. I have met with the troika and we are hoping for the best, fairest agreement possible,'' Cypriot president Nicus Anastasiades said on his arrival at the EU summit. But German Chancellor Angela Merkel said that Cyprus will not be in the agenda until the work of Troika will be concluded.

The summit underway is one marked by growing demands for less austerity and more measures to stimulate growth.

Italian Premier Mario Monti arrived at the European Council early Thursday morning to prepare for a meeting in which Italy aims to achieve greater willingness to consider the 'Golden Rule', the possibility of separating deficit calculations from productive state investment.

Italy will ask for ''a margin of flexibility'' on investment as part of ''budgetary discipline'', Monti said on the sidelines of the summit, adding that he was convinced ''we will be listened to, both today and I hope in the future, since Italy has proved its extraordinary faith in Europe, and was able to bring about recovery to its state finances''. EU Council president Herman Van Rompuy said that ''if Italy continues in the direction of the past few months, it has every chance of returning to its rightful place in the eurozone''. Other countries - such as France, Spain and Portugal - want greater flexibility on public finance recovery plans to avoid choking national economies that are already struggling, fostering unemployment and ever more explosive levels of social problems. A sharp divide may emerge during the summit with those backing austerity under Germany, which expects other EU partners to abide by similar budget rules as its own.

An anti-austerity protest called by European trade unions brought some 15,000 people to Brussels' streets Thursday, according to union sources. (ANSAmed).

ALL RIGHTS RESERVED © Copyright ANSA

Business opportunities

The information system of business
opportunities abroad

News from Mediterranean