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Weidmann Urges Europe to Focus on Reform Efforts, Not Price Tag

  • Bundesbank president says reforms must fit into existing rules
  • Merkel outlined response to reform proposals on Sunday

Bundesbank President Jens Weidmann aptly chose Brussels to tell European leaders that deeper integration doesn’t have to come with a higher price tag, picking up the debate two days after German Chancellor Angela Merkel outlined her vision for strengthening the region.

“More Europe does not necessarily have to mean more money for Europe,” Weidmann said on Tuesday. “Europe first needs to define the tasks that it would make sense to accomplish jointly and that should therefore also be funded jointly instead of starting off by talking about money, and thus putting the cart before the horse.”

Merkel presented her plans for euro-area reforms in a Sunday newspaper interview, responding to proposals made by French President Emmanuel Macron. She stressed the need for a new euro-area bailout mechanism to address crises, as well as a separate investment fund to help weaker nations, while striking a less ambitious tone than Macron.

Weidmann, a member of the European Central Bank’s Governing Council, said that any overhauls “need to fit within the existing Maastricht framework” of fiscal sovereignty, adding that this doesn’t rule out an expansion of mutual liability.

Topics such as border security and migration that have “visible European added value” should be addressed at the regional level, and a rainy-day fund could offer “greater room for maneuver in difficult situations,” he said. At the same time, “there are tasks that are still more at home at the domestic level.”

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