STOCK MARKET WATCH - Wednesday, 1 February 2012

[Demeter]

20. EU summit: UK and Czechs refuse to join fiscal compact

http://www.bbc.co.uk/news/world-europe-16803157

Twenty-five of the EU's 27 member states have agreed to join a fiscal treaty to enforce budget discipline. The Czech Republic and the UK refused to sign up. UK Prime Minister David Cameron said his government would act if the treaty threatened UK interests. He still has "legal concerns" about the use of EU institutions in enforcing the fiscal treaty, he said. The Czechs cited "constitutional reasons" for their refusal, France's President Nicolas Sarkozy said. Czech President Vaclav Klaus, a Eurosceptic, may be reluctant to sign the treaty, analysts say.

The goal is much closer co-ordination of budget policy across the EU to prevent excessive debts accumulating. Germany - the eurozone's biggest lender and most powerful economy - was particularly keen to get a binding treaty adopted to enforce budget rules.

The treaty will empower the European Court of Justice to monitor compliance and impose fines on rule-breakers. The treaty also spells out the enhanced role of the European Commission in scrutinising national budgets...

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