25 out of 27 E states joined the treaty for budget stability proposed in December 2011, EU President Herman Van Rompuy said on Twitter. There was an initiative to set the maximum limit of the budget deficit in relation to the GDP at 0.5%, RIA Novosti reports.
The EU president confirmed earlier plans for an automatic mechanism to balance the deficit. It will come into force as soon as 12 states sign it.
The Czech Republic and UK reject the agreement. The Czech Republic made its decision within the framework of the session, UK refused to sign a new agreement back in December 2011.
Jose Manuel Barroso, President of the European Commission, announced signing of the document for March 2012.
The agreement on budget stability involves automatic sanctions for budget deficit exceeding the 3% limit of the GDP. Balancing the deficit under 0.5% will be the key element. Countries with state debt under 60% of the GDP may have a higher deficit.
The document is to come into force in 2013. It needs ratifying by only 12, rather than all 17 euro states.
Finances ministers of the euro zone had been asked to unblock 130 billion euro of financial aid for Greece by the end of the week, Rompuy said. Otherwise Greece would face a market crash in March. Spiegel reported that Greece would need about 145 billion euro.
The EU ordered banks to write off 50% of the nominal price for Greek bonds. Efficient writing off could be reached at 70%.
Greece and the EU demanded creditors to reduce the rate below 4%.
The Institute for International Finances (IIF) said that Greece is expected to restructure its debt this week. Athens said that an official proposal for creditors will be made no later than on February 13, 2012.
Standard & Poor’s reduced the rating of 9 euro zone states, including France, Italy, Spain and Portugal. Experts believe that reduction of budget expenses may provoke drops in consumer demand, disrupting taxing.
Jean-Claude Juncker, President of the Euro Group, said in Luxembourg on January 19 that the zone was on the edge of economic recession. He urged searches for economic boosts. He added that rating agencies should not be given so much attention.
