EU fiscal pact in March

The German Chancellor Angela Merkel and French President Nicolas Sarkozy announced yesterday that the fiscal pact in the European Union (EU) could be signed in March and the agreement to set a brake on the debt could be brought forward to January.

After a meeting of two hours in Berlin, both stressed the importance of improving the efficiency of the mechanisms the EU anti-crisis and reduce sovereign debt without neglecting the growth and employment, while they warned Greece that it must fulfill its "obligations" to continue receiving aid.

Merkel stated that the negotiations to achieve the fiscal pact "are advancing at a good pace" and that there are "many possibilities" that the Summit of the EU scheduled for later this month is already approved measure that legally limits the borrowing State.

The French President stressed that Berlin and Paris share the "same analysis" of the current situation: that has to be drastically reduced u000athe public debt, but that is an "absolute priority" promoting growth and employment.

In this sense, Merkel said that growth and job creation is the "second pillar" of the recovery, together with fiscal consolidation, and announced a community study to analyse the different labour markets of the EU and the successful measures taken in them.

As to the status of Greece, both leaders stressed their desire to the hellene country continue belonging to the eurozone, but urged Athens to comply with their commitments.

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Mechanisms "more flexible"
Angela Merkel and Nicolas Sarkozy also reported his desire to make "more efficient" and "more flexible" financial mechanisms to assist countries with problems. "Germany and France, in contact with other countries, are willing to explore how to accelerate their contributions" to the u000aEuropean stability mechanism (COMPRISES), the permanent instrument which will be operational in the middle of this year, said the head of the German Government.

Addition, stated that the Franco-German axis is considering giving more powers to the temporary European financial stabilisation (EFSF) Fund, so that, among other issues, to "intervene in the market primary" debt. Sarkozy, for its part, insisted on the need of introducing a tax on financial transactions as soon as possible, something that would set a "good precedent" and would add pressure on the global level.

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