European leaders agree on plan to shore up banks
Chancellor Merkel 'very satisfied that we took good decisions on growth'
European leaders have finally agreed on a plan to shore up ailing banks.
The decision came after lengthy meetings that appeared headed towards
failure. The decision will require the countries to form a tighter
union, while yielding slightly on tough reforms in exchange for bailout
German Chancellor Angela Merkel will return to her homeland to discuss with German MPs before they vote on the fiscal pact and permanent bailout fund.
German Chancellor Angela Merkel said that she was "very satisfied that we took good decisions on growth."
The bank decision was aimed at helping Spain, which sought a $126 billion in U.S. dollars rescue to help its troubled banks. European Council President Herman Van Rompuy declared it a "breakthrough that banks can be recapitalized directly," noting that leaders of the 17-nation eurozone have agreed to a joint banking supervisory body.
Van Rompuy said the leaders of the full 27-member European Union have agreed to a general long-term plan for a tighter budgetary and political union.
Under the new agreement, countries could apply for bailouts that would not come with the stringent conditions that have accompanied previous EU bailouts. Italian Premier Mario Monti, who supported the agreement, says that many countries were already reforming their budgets.
EU leaders agreed on to devote $151 billion in U.S. dollars in stimulus to encourage growth and create jobs. France argued that austerity measures imposed to stem Europe's debt crisis were stifling growth and making it worse.
German lawmakers are expected to approve two key tools for battling Europe's debt crisis after weeks of wrangling to ensure Merkel secures broad backing for the measures.
Merkel will return to her homeland to discuss with German MPs before they vote on the fiscal pact and permanent bailout fund. Her speech to the lower house of parliament, which is to begin sitting from 1500 GMT, will be followed by the 620 members voting on the pact which commits Germany and its partners to more budgetary discipline.
"One reason why Angela Merkel needs to leave to Berlin tomorrow to get a three-fifths majority in the Bundestag is that she needs to prove to the parliamentarians that she has fought her corner," Al Jazeera's Nick Spicer says.
"Monti, equally, needs to prove that he has fought his corner in Brussels, if he is to continue getting support for painful reforms that he is bringing about. So we do need to take with a small grain of salt what the European leaders are saying here in Brussels, but that is not at all to minimize the challenges that they face."
© 2012, Catholic Online. Distributed by NEWS CONSORTIUM.
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Pope Benedict XVI's Prayer Intentions for January 2013
General Intention: The Faith of Christians. That in this Year of Faith Christians may deepen their knowledge of the mystery of Christ and witness joyfully to the gift of faith in him.
Missionary Intention: Middle Eastern Christians. That the Christian communities of the Middle East, often discriminated against, may receive from the Holy Spirit the strength of fidelity and perseverance.
Keywords: Europe, banks, Angela Merkel, Italy, Spain
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