Merkel seeks parliament backing before crunch EU talks

26th October 2011, Comments 0 comments

Chancellor Angela Merkel was poised Wednesday to win crucial backing from German lawmakers on beefing up the EU's bailout fund, hours before a crunch summit to tackle the euro debt crisis.

On what several German dailies called a "day of fate" for the euro, Merkel seemed sure to clinch broad support for plans to raise the firepower of the bloc's 440-billion-euro ($612-billion) war chest to stop the crisis spreading.

All the parliamentary groupings in the Bundestag lower house of parliament -- with the exception of the Linke far left -- have signed a text giving Merkel a mandate to scale up the fund without adding more money -- out of the question in EU paymaster Germany.

The brief text, obtained by AFP, refers to two models being examined for bolstering the fund, the European Financial Stability Facility, or EFSF.

One would insure jittery investors against potential future losses from the debt of shaky countries, hopefully encouraging them to continue to buy bonds from the likes of Italy, Portugal and Spain.

The second calls for aid to be co-financed by public or private investors, including foreign countries. "The two models are not mutually exclusive," the text says.

Earlier Wednesday, the China Daily reported that Beijing and other emerging powers had agreed to help the eurozone, citing a source close to EU decision makers.

While the vote is expected to pass with cross-party support, Merkel again faces a rebellion from within her conservative grouping, raising the spectre of having to rely on the opposition, which would weaken her politically.

In a similar vote in September, 15 MPs from her centre-right coalition voted against her.

She needs 311 votes from her own 330-strong conservative grouping to secure the crucial majority. "Mrs Merkel needs these 311 magic votes to be able to go to Brussels with her head held high," news weekly Spiegel wrote on its online edition.

The increased level of parliamentary involvement in Germany's EU policy stems from a landmark judgement by the country's top court in September that ruled the legislature must have more say in decisions taking place in Brussels.

Some top EU officials have criticised the ruling, saying it slows down the procedure, especially in times of crisis.

"Organisational speed in Berlin is slower than in the other capitals," Jean-Claude Juncker, prime minister of Luxembourg and head of the eurozone finance ministers, said recently.

Merkel was due to address the chamber at around 1000 GMT, ahead of a debate and the vote.

Following the vote, Merkel will fly to Brussels where EU leaders were due to gather from 1600 GMT.

After this meeting, the heads of the 17 eurozone countries will hold talks in a bid to thrash out a solution to what is seen as the worst economic emergency in the EU's history that threatens to tip the world into recession.

"It is going to be a long day," said Merkel's spokesman Steffen Seibert, on microblogging site Twitter.

© 2011 AFP

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