Friday 29 June 2012
Prime minister Mark Rutte denied claims by opposition parties on Friday that he had gone further than planned in agreeing that bail-out funds can be used directly to help Spanish banks.
Eurozone leaders on Friday agreed to take emergency action to bring down Italy and and Spain's borrowing costs and to create a supervisory body for eurozone banks, seen by many as a first step towards European banking union.
The leaders also agreed to use the bail-out fund to support struggling banks directly, so avoiding adding to countries' debt.
Rutte told a news conference on Friday 'the problems facing Spanish banks threaten to become so large that there is a risk to the entire Spanish economy.'
The prime minister denied he had changed his position on direct support for banks, pointing out that agreements have now been reached on the supervisory structure. Criticism from MPs, he said, is due to the approaching general election.
The bank bail-out scheme did not mean banks would be recapitalised 'just like that', the prime minister said.
'If there is European supervision, then you can imagine supporting banks using the ESM emergency fund. But support has to be unanimous,' Rutte said. He described the decision to set up a European banking supervisor as 'a logical step'.
Rutte, said by news agency ANP to be one of the few EU leaders to give a press conference, has been under fire at home for sending out a mixed message on Europe and not being clear enough about the Dutch position.
The Financieele Dagblad says the agreement means Rutte and German chancellor Angela Merkel have made concessions to Italy and Spain, who had piled on the pressure for a solution to their banking problems.
Opposition MPs were quick to use the microblogging service Twitter to comment. ‘The prime minister is also very flexible under pressure,’ said Arie Slob, leader of the ChristenUnie.
Geert Wilders, who has vowed to make Europe the main election issue, said Rutte is ‘slavishly on his knees in front of the Italian and Spanish mafia.’
However, D66 leader Alexander Pechtold was positive about the agreement, saying it represented important steps toward furthering a unified banking system and increased democracy.
And Labour leader Diederick Samsom said the agreement marked a ‘greater than expected’ shift towards banking union, which, he said, is good for EU stability.
Is this the right way forward for the eurozone? Have your say using the comment box below