veto threat may split EU into two
Brussels A “last chance” summit to save the euro was in peril Friday with European leaders at lo cheap ugg boots ggerheads over the eurozone debt crisis.
Fears that Europe could split into a “two speed” zone grew alarmingly after Britain threatened to veto any treaty agreement by European nations that undermined British sovereignty or London’s financial institutions.
Hours of talks that stretched into the early hours, failed to change Britain’s position and leaders eventually abandoned any hopes of securing unanimous agreemen cheap ugg boots t by the 27 European nations on treaty change.
Instead, diplomats confirmed that talks would now go forward seeking a new inter governmental agreement designed for the 17 countries that have the euro as their currency as well as others aiming to join the currency union.
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Britain, as well as Denmark, have opted out of adopting the single currency. Eight other nations are legally committed to taking up the euro.
British Prime Minister David Cameron went to the summit in Brussels saying powers cannot pass from London to Brussels without a referendum. He also wanted the City of London financial sector to be exempt from tough new EU regulation or a proposed tax on financial transactions.
“If I can’t get what I want, I will have no hesitation in vetoing a treaty because I am not going to go to Brussels and not stand up for our country,” Mr. Cameron said.
Treaty change requires unanimous approval from the bloc’s 27 nations. However, the 17 countries of the eurozone might now choose to create a separate treaty o cheap ugg boots f their own a two speed Europe.
Difficult talks running overnight began on a sour note when European Central Bank president Mario Draghi, who joined pre summit negotiations with a restricted power group of Germany, France and leading EU officials, sent stock markets falling.
Mr. Draghi spooked financial markets by discouraging expectations that the bank would massively step up buying of government bonds if EU leaders agreed on moves toward closer fiscal union.
As soon as the draft summit agreement leaked, a senior German official rejected key measures, including letting the future rescue fund, the European Stability Mechanism, operate as a bank, borrowing from the ECB, and a long term goal of issuing common eurozone bonds. and eurozone economist at Scotia Capital. “The eurozone leaders might as well not bother. Pack their bags, go home, enjoy the weekend and do their Christmas shopping.”
Leaders did take tentative steps Thursday to implement a so called “golden rule” asking countries to set balanced budgets until debt levels drop, although this was only agreed “in principle” with political wriggle room remaining, diplomats said.
The 27 EU leaders agreed in principle on automatic sanctions for eurozone deficit offenders unless three quarters of states vote against the move, and approved a fiscal rule on balanced budgets to be written into national constitutions.
French President Nicolas Sarkozy dramatised the danger facing the 17 nation single currency area hours before their eighth crisis summit of the year in a speech to European conservative leaders in the French port city of Marseille. “Never has the risk of Europe exploding been so big,” he said. “If there is no deal on Friday there will be no second chance.”
France and Germany used the Marseille meeting to lobby for their plan to amend the European Union cheap ugg boots treaty to toughen budget discipline, which they want to have ready by March. But several countries are sceptical of full blown treaty change.
German Chancellor Angela Merkel said on arrival in Brussels, “The euro has lost credibility and this must be won back. We will make clear that we will accept more binding rules.”
European Council president Herman Van Rompuy, the summit chairman, wanted all 27 EU states to agree to a rule changes via a minor adjustment to a treaty protocol that could be implemented quickly without requiring full ratification.
This outraged Ms. Merkel, who was demanding a fully fledged treaty change to give the measures extra weight.
“The Germans are obsessed with how we are going to do things, saying we have to change the treaty. They are totally obsessed. That’s why it can get difficult,” an EU diplomat said.