German Chancellor Angela Merkel and French President Nicolas Sarkozy will propose to their European partners, in September, a tax on financial transactions and the formation of a “genuine government of the euro zone”.
“Finance ministers from Germany and France will propose to the European institutions, in September, a tax on financial transactions”, said Sarkozy in a press conference following talks with Merkel.
The two leaders also proposed the creation of “a genuine government of the euro area”, to be headed for a term of two and a half years, by the current President of the European Union, Herman Van Rompuy.
After talks in Paris, Sarkozy said that he proposed, together with Merkel, for all the 17 euro zone member states to undertake to balance their finances and to include in their Constitution this goal by next summer.
Another proposal is to improve cross-border governance, by the bi-annual meetings of European leaders.
“We wish to express our determination to defend the euro and to assume special responsibilities of Germany and France in Europe, so we have a common view on all issues”, said Sarkozy.
Merkel said on the other hand that she does not believe that “Eurobonds could be helpful at this time”.
Sarkozy has also said that these common bonds could jeopardize the countries with high credit ratings and they only represent “the culmination of the integration process”.
The two leaders are under pressure to come up with plans to strengthen the euro area and restoring confidence in financial markets, after a year and a half of tensions that have not disappeared despite the rescue plans for Greece, Ireland and Portugal.
Following statements on improving economic coordination, the U.S. Treasury security prices for ten years have reversed the negative trend, and their yield has decreased to 2.25%.