German Chancellor Angela Merkel wants Greece to remain a EU member. She said that Greece passed a program for debt restructuring and has a chance to overcome recession. Merkel sees no alternative to structural reforms starting from state finances to reforms of the labour market, Reuters reports.
The German chancellor says that 25 out of 27 state leader of the EU signed the budget pact in Brussels on March 2, 2012. She believes that it was wrong not to form a fiscal union earlier with introduction of euro.
Merkel said that the Netherlands is still working on the budget. Spain promised to reduce the budget deficit to 3% of the GDP by 2013. The states are to reach an agreement on employment of young people.
The EU budget pact introduces a mechanism of semi-automatic sanctions against EU members for violating the budget discipline. It requires a more balanced and higher surplus budget. Their structural deficit must not exceed 0.5% of the nominal GDP. The initiative is expected to come into force in a year. The EU Court will adopt the document.
25 EU states, except the Czech Republic and UK, signed the document. It comes into force after being ratified by at least 12 states.
Meanwhile, the Euro Group has decided to increase the EFSF and ESM funds from 500 billion to 800 billion euro. The Euro Group made its decision in Copenhagen on March 30, 2012. EU Commissioner for Economy and Finances Olli Rehm said that the increase of anti-crisis funds will improve the euro zone.
