The eurozone’s 440 billion euro debt guarantee scheme is tantamount to the adoption of a Nato-style mutual defence clause and marks an “unprecedented” change to the bloc’s treaties, according to France’s Europe minister.
In an interview with the Financial Times, Pierre Lellouche laid bare the French government’s conviction that the emergency stabilisation scheme agreed earlier this month amounted to a fundamental revision of the European Union’s rules and a leap towards an economic government for the bloc.
“It explains some of the reticence. It is expressly forbidden in the treaties by the famous no bail-out clause. De facto, we have changed the treaty,” he added.
Mr Lellouche’s comments are likely to go down badly in Germany, where the government has insisted the debt guarantee scheme to help beleaguered eurozone members is a temporary mechanism, set up on an intergovernmental basis where Berlin retains a veto, and in no way implies a breach of the EU’s treaties.
Mr Lellouche said Angela Merkel, the German chancellor, was “right” to say the EU could not be a “transfer zone” where rich members directly subsidised poorer ones.
But he said the scheme institutionalised solidarity between states.
“The 440 billion euro mechanism is nothing less than the importation of Nato’s Article 5 mutual defence clause applied to the eurozone. When one member is under attack the others are obliged to come to its defence.”
Mr Lellouche rejected suggestions that the Franco-German relationship had broken down because of tensions over the Greek and eurozone bail-out plans.
But he conceded that it required a lot of effort to make the relationship work, likening the challenge to postwar reconciliation between the two countries.
“To hold out our hands and offer a partnership of equals with Germany required a lot of vision. That’s a bit what it is like today.” France accepted as “normal” that Germany now asserted its own national interests, Mr Lellouche said.
“Twenty years after reunification, there is a new generation, there is globalisation, there is demographic pressure, you have a Germany that like everyone claims its national interests. I understand that totally ... Since when did we expect Germany to act as cash cow indefinitely?”