6 Dec 2011

New EU treaty needed

10:40 pm on 6 December 2011

President Nicolas Sarkozy of France and Chancellor Angela Merkel of Germany say the EU needs a new treaty to deal with the eurozone debt crisis.

After a meeting in Paris, Mr Sarkozy said a new treaty should be in place by March to ensure such a crisis never happened again.

They said eurozone states should face greater checks on their budgets and sanctions if they ran up deficits.

An EU summit is be held in Brussels on Friday. The BBC reports it is seen as crucial for the future of the single currency.

Mrs Merkel said France and Germany wanted to see structural changes which go beyond agreements.

The two leaders said they wanted treaty changes to be implemented by all 27 EU members, but if that was not possible, just the 17 states which have adopted the euro.

The BBC reports their proposals include:

Automatically applying sanctions to any state which breaks the 3% public deficit rule

Requiring eurozone national budgets to include a golden rule against running up deficits, with those budgets to be verified by the European Court of Justice

No introduction of jointly held euro bonds

Eurozone heads of government to attend a summit every month as long as the crisis persists