Saudi Arabia approves cooperation agreement with US for the use of outer space for peaceful purposes    Quality of Life Program CEO highlights Saudi urban transformations at UN-Habitat conference in Cairo    AlHisn Big Time Studios unveiled to transform film and TV production in Riyadh    Saudi Aramco's Q3 net income falls 15.5% to SR103 billion amid a jump in annual cash flows    Almarai wins 'Best Corporate Sukuk' at Asset Triple A Islamic Finance Awards    Top climber falls to death after rare Himalayan feat    US voters flying home in time for election    Drones and snipers on standby to protect Arizona vote-counters    India's Modi condemns violence after Canada temple incident    Harris and Trump make final push in must-win Pennsylvania    Mitrovic's hat-trick leads Al Hilal to 3-0 victory over Esteghlal    Al Ahli extends perfect start with 5-1 victory over Al Shorta    Saudi crown prince, Tunisian president review bilateral relations in phone call    SFDA Chief visits premier biotechnology and medical firms in China    Al-Khereiji: Collective action in combating terrorism is a must for achieving stability and prosperity    Quincy Jones, titan of US music, dies aged 91    Neymar expected to join Al Hilal squad for AFC clash against Esteghlal, says coach Jesus    Al Qadsiah secure 2-0 victory over Al Ettifaq in first Eastern Derby since 2021    Hidden sugars in Asia's baby food spark concerns    HONOR unveils pre-order of the stunning HONOR MagicBook Art 14 Featuring an ultra-slim design, HONOR Eye Comfort Display and AI Cross-OS WorkStation    India puts blockbuster Pakistani film on hold    The Vikings and the Islamic world    Filipino pilgrim's incredible evolution from an enemy of Islam to its staunch advocate    Muted Eid celebrations for millions of Nigerian Muslims    Exotic Taif Roses Simulation Performed at Taif Rose Festival    Asian shares mixed Tuesday    Weather Forecast for Tuesday    Saudi Tourism Authority Participates in Arabian Travel Market Exhibition in Dubai    Minister of Industry Announces 50 Investment Opportunities Worth over SAR 96 Billion in Machinery, Equipment Sector    HRH Crown Prince Offers Condolences to Crown Prince of Kuwait on Death of Sheikh Fawaz Salman Abdullah Al-Ali Al-Malek Al-Sabah    HRH Crown Prince Congratulates Santiago Peña on Winning Presidential Election in Paraguay    SDAIA Launches 1st Phase of 'Elevate Program' to Train 1,000 Women on Data, AI    41 Saudi Citizens and 171 Others from Brotherly and Friendly Countries Arrive in Saudi Arabia from Sudan    Saudi Arabia Hosts 1st Meeting of Arab Authorities Controlling Medicines    General Directorate of Narcotics Control Foils Attempt to Smuggle over 5 Million Amphetamine Pills    NAVI Javelins Crowned as Champions of Women's Counter-Strike: Global Offensive (CS:GO) Competitions    Saudi Karate Team Wins Four Medals in World Youth League Championship    Third Edition of FIFA Forward Program Kicks off in Riyadh    Evacuated from Sudan, 187 Nationals from Several Countries Arrive in Jeddah    SPA Documents Thajjud Prayer at Prophet's Mosque in Madinah    SFDA Recommends to Test Blood Sugar at Home Two or Three Hours after Meals    SFDA Offers Various Recommendations for Safe Food Frying    SFDA Provides Five Tips for Using Home Blood Pressure Monitor    SFDA: Instant Soup Contains Large Amounts of Salt    Mawani: New shipping service to connect Jubail Commercial Port to 11 global ports    Custodian of the Two Holy Mosques Delivers Speech to Pilgrims, Citizens, Residents and Muslims around the World    Sheikh Al-Issa in Arafah's Sermon: Allaah Blessed You by Making It Easy for You to Carry out This Obligation. Thus, Ensure Following the Guidance of Your Prophet    Custodian of the Two Holy Mosques addresses citizens and all Muslims on the occasion of the Holy month of Ramadan    







Thank you for reporting!
This image will be automatically disabled when it gets reported by several people.



Anger simmers at German austerity plan for EU
Published in Saudi Press Agency on 07 - 02 - 2011

Awwal 04, 1432 H/Feb 07, 2011, SPA -- Resentment smouldered among European governments on Monday over a German-instigated drive to end wage indexation, raise retirement ages and lock debt limits into national constitutions across the euro zone, according to Reuters.
Chancellor Angela Merkel, backed by French President Nicolas Sarkozy, presented proposals for a "competitiveness pact" to EU leaders at a summit last Friday, provoking strong pushback due to both a lack of prior consultation and the objectives chosen.
Merkel made clear that agreement on these measures, designed to align economic policies more closely with Berlin's, must be sealed in March before she will agree to strengthening the rescue fund for debt-stricken euro zone countries.
"The negotiations will be tough, that's clear already. But we want an agreement and there is still a bit of time," she told a news conference after talks in Warsaw on Monday with Polish President Bronislaw Komorowski and Sarkozy.
EU Monetary Affairs Commissioner Olli Rehn said EU leaders had given clear support for boosting the effective capacity of the euro zone's emergency fund and making it more flexible.
"It is work in progress and I expect we will have decisions in the course of March," he said.
A senior source in Germany's governing coalition also said the heads of government had made good progress on beefing up the European Financial Stability Facility (EFSF), and he expected an agreement before the next formal EU summit on Mar. 24-25.
Greece, already subject to a tough austerity programme in return for a 110 billion euro ($150 billion) EU/IMF bailout last year, voiced opposition to the attempt to make member states change their constitution if they want financial assistance in future.
"I reject categorically the thought of an EU decision to intervene in all national constitutions," Deputy Prime Minister Theodoros Pangalos told daily Ta Nea in an interview.
"The thought that this be a precondition for joining in the German rescue plan is not attractive to me," he said.
ACRIMONY
Diplomats said Friday's EU summit was acrimonious with lots of finger-pointing at other countries' alleged shortcomings.
Belgium, whose caretaker government can ill afford a social crisis, objected to scrapping inflation-indexing of wages. Under the Belgian system, trade unions accepted a wage cut without protest last year because prices had fallen.
Portugal, Luxembourg, Austria and Spain, which all have elements of automatic inflation adjustment, were also opposed.
Italy, which has the EU's second highest debt-to-GDP ratio after Greece, disliked the proposal to anchor binding debt reduction targets in its constitution.
Austria said it opposed any EU-wide retirement age or centrally mandated system for linking the retirement age to demographic trends in each member state.
Ireland, which is counting on foreign investment to help it recover from its own bailout, rejected the idea of setting a minimum corporation tax level in the euro zone or harmonising the corporate tax base.
A senior official from one southern European country, speaking on condition of anonymity, said the Franco-German plan addressed issues that had little or nothing to do with the causes of the euro zone crisis.
"If we have to agree on a package, the first test is: If we had this package five years ago, would the crisis have been avoided? A package containing only tougher fiscal rules would not have prevented crisis in Ireland, Spain, Portugal, all of which had very solid public finances," he said.
"Some countries look only at public finance and forget the rest. I have the feeling that there is too much emphasis on debt reduction," said the official from a highly-indebted country.
RUFFLED FEATHERS
Seeking to smooth ruffled feathers, Merkel and Sarkozy evaded questions about objections to their initiative and said they hoped Poland would join the "competitiveness pact", even though it is not yet in the euro area.
French officials have said the individual measures in the pact are open to negotiation, and Merkel said she was awaiting proposals from the executive European Commission in this area.
The European Central Bank disclosed on Monday that it had bought no euro zone government bonds for the second week running in a fresh sign that market tensions have eased in expectations of a comprehensive response to the debt crisis in March.
Portugal took advantage of this lull to launch a five-year syndicated bond issue and said demand was a healthy 6 billion euros -- double the minimum planned placement.
ECB policymaker Axel Weber, head of Germany's influential Bundesbank, said reforms to the EU's budget discipline rules agreed so far made some improvements but did not go far enough.
"The major shortcoming of the envisaged reform is that relevant decisions on sanctions are still to be taken at a political level by the European Council," he said in a speech prepared for delivery in Tallinn.
This left "too much room for discretion in interpreting and applying the rules", Weber said.


Clic here to read the story from its source.