ECB's Weber: EU debt measures 'the minimum necessary'

24th November 2010, Comments 0 comments

Germany's central bank chief said Wednesday that European efforts to tighten budget discipline should be considered the absolute minimum necessary to safeguard against future debt crises.

In a speech at the German embassy in Paris, Axel Weber said: "The guidelines that have been agreed at European level should be understood as the minimum targets."

EU leaders agreed in October to toughen sanctions against member states in the 16-nation eurozone that break the bloc's debt rules.

Weber said he would continue to press the German government to reduce its deficit further.

"The Bundesbank will not tire of encouraging the German government to use the good economic situation for a steeper consolidation path," he said, according to the text of the speech provided by his office.

"Consolidation strengthens confidence in the sustainability of state finances and this is an important pre-condition for robust economic growth in the whole eurozone."

Weber, tipped as a possible successor to current ECB head Jean-Claude Trichet, also backed Chancellor Angela Merkel in her desire to have private investors contribute to the costs of any future bailout, a wish that has caused turbulence in the markets.

"Private investors should not be released from their responsibilities," said Weber.

"But I would like to stress that such a mechanism should be set up after the crisis has ended and not tamper with current agreements."

© 2010 AFP

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