MEPs push for muscling up eurozone

The members of the European Parliament (MEP) called for efforts to "muscle up" the ailing eurozone as radical plans have been approved by the European Parliament in its plenary last week.

In a resolution drafted by two senior MEPs, Reimer Boge and Pervenche Beres, the lawmakers called for actions to bring the euro area economies closer together and making them more resilient to "outside shocks."

The resolution, approved by parliament by 304 votes to 255 against, was welcomed by the Parliament's president Antonio Tajani who said the proposals were an invaluable contribution to the ongoing debate about the European Union's future.

The MEPs advocated a convergence strategy funded by a specific euro area budget, financed by its member states and available under "clear conditions."

Key proposals include a fiscal capacity consisting of the European Stability Mechanism (ESM) and specific additional budgetary capacity for the euro area, funded by its members as a part of the EU budget.

In the resolution, they also called for a European Monetary Fund, which should gradually develop out of the ESM, with "adequate lending and borrowing capacities and a clearly-defined mandate to absorb economic shocks."

The lawmakers also recommended the creation of a "convergence code", proposing a five year period to meet convergence criteria on taxation, labor market, investment, productivity, and social cohesion and governance.

A final proposal is for a bigger role for the European Parliament and national parliaments, merging the functions of Eurogroup president and economic and monetary affairs Commissioner, plus a finance minister and treasury within the European Commission.

German MEP Boge said, "Stabilizing the Eurozone would be in the interests of the European Union as a whole. Our proposals will therefore lay the basis for any further negotiations with the other European institutions. International Monetary Fund experts have also responded positively, showing great interest in our ideas."

Further comment came from Beres, a senior French MEP, who said, "Sixty years after the Treaty of Rome was signed, the spirit of the European Union's founding fathers needs to be reignited. Creating a budget for the euro area would be a big step towards this goal, at a time when the need to preserve the euro's integrity has never been more urgent." Enditem