Merkel Sees No Alternative to Making Euro Area a Stable Zone

German Chancellor Angela Merkel said there’s “no alternative” to developing the euro region into an area of stability, which includes the need for all its members to adhere to budgetary rules.

“There is no alternative to developing the European Union, and the euro zone at its core, into a stable zone and to take the necessary measures for that,” Merkel said today in a speech in Hanover, Germany. “That means, on the one hand, trust in everybody adhering to the rules, for example as regards stable budget policies and solid budget policies, and on the other hand trust that there are mechanisms of solidarity in place within this European Union and the euro zone in these difficult times that give every participant the chance to prove in coming years the solidity that may have been absent in the past.”

The euro region’s debt crisis threw the bloc into a “true crisis,” Merkel said at the opening of the CeBit computer fair in the state capital of Lower Saxony. Still, the EU with its 500 million inhabitants has “every chance to participate in dynamic global developments,” Merkel said.

Portugal will “absolutely not” alter the deficit goals it pledged in return for a European Union-led aid package last year, Prime Minister Pedro Passos Coelho said in an interview in Lisbon today after Spanish Prime Minister Mariano Rajoy on March 2 defied European Union allies by raising Spain’s budget-deficit target.