March 11, 2011
Leaders of the eurozone agreed in principle on Friday to write limits on public debt and budget deficits into law. The deal meets a key German condition for increasing the eurozone safety net, however wrangling continued over other requirements.
Angela Merkel was seeking concessions on corporation tax and privatisation from the Irish and Greek governments in return for easing the terms of their bailouts.
The Brussels summit of the 17 countries in the eurozone was seeking to agree on a German-scripted pact on common fiscal and economic policies – Berlin's price for bankrolling a permanent eurozone bailout regime from 2013 for countries at risk of sovereign default.
But the German terms for what is dubbed the "pact for the euro" have been fought over intensely since being unveiled last month and Merkel's blueprint has been watered down by Herman van Rompuy, the European council president, and José Manuel Barroso, head of the European commission.
"Agreement in principle on the Pact for the Euro, but still discussing the other elements of the package," Van Rompuy said in a posting on Twitter tonight.
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