EU leaders clinch pact to defend euro
Baku, October 29 (AZERTAC). EU leaders say tough new budget rules agreed at their summit in Brussels will protect the euro from a future Greek-style debt crisis.
The EU "sealed a solid pact to strengthen the euro," said European Council President Herman Van Rompuy.
A permanent fund will be set up to bolster the euro in times of crisis, and the EU will have extra powers of scrutiny over national budgets.
A 2.9% limit on the EU budget increase was also agreed, under UK pressure.
But tough negotiations are expected with the European Parliament, which voted for a 5.9% rise. If no deal is reached by mid-November the 2011 budget will be frozen at the 2010 level.
Enforcing rules
EU officials said the eurozone had almost collapsed during the Greek debt crisis in May because it lacked a rescue mechanism.
Germany wants limited changes to the EU`s Lisbon Treaty to reinforce the changes, but is facing resistance from other countries.
The leaders will return to Brussels in December, hoping to agree upon any revision, which it is hoped will be ratified in all EU countries by mid-2013.
Meanwhile, UK Prime Minister David Cameron won backing for his battle against a 5.9% rise in the EU budget.
Germany and France were among 10 nations supporting Mr Cameron`s attempt to limit the budget increase to 2.9% - a rise that would still cost UK taxpayers roughly £435m (500m euros).
"Now we have agreed that the EU budget must reflect what we`re doing in our own countries," Mr Cameron said, describing the deal as "incredibly important".
He will have further talks with German Chancellor Angela Merkel at his Chequers residence on Saturday.
The bigger prize for Mr Cameron would be a deal to keep the UK`s hard-won budget rebate, as difficult talks loom on the EU budget period beyond 2013.
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