EU finance ministers’ taskforce meets in Brussels

EU finance ministers have arrived for a meeting in Brussels at the end of a week of instability on the markets and signs of disunity between members.

Talk of a rift between France and Germany has grown after Germany restricted some short-selling without consulting other European nations.

But German Chancellor Angela Merkel has said Europe stands together to restore confidence in the euro.

French President Nicolas Sarkozy stressed there were “no disagreements”.

‘Losing confidence’
 
The head of the International Monetary Fund, Dominique Strauss-Kahn, underlined the importance of the meeting.

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European markets continued to fall in afternoon trading, with share indexes in London, Paris and Frankfurt all down about 2%.

Global stock markets have tumbled this week and the euro fell to a four-year low against the dollar on continuing concerns about Europe’s debt crisis and the future of the single currency.

Mrs Merkel has said she believes the euro is “in danger”, although French Finance Minister Christine Lagarde denied this, saying she “absolutely” did not believe that to be true.

Meeting agenda
 
The meeting is being held under the chairmanship of EU President Herman Van Rompuy.

Ministers will discuss Germany’s unilateral ban on naked short-selling, and future co-ordination of such market-moving decisions.

 The UK will not hand over economic sovereignty to Brussels Germany has called for stricter economic regulation and stronger budgetary discipline by European governments.

One idea on the table is to look at national budget proposals in the first six months of the year instead of the second six months.

However this idea may be controversial with the UK, as Chancellor George Osborne has said he believes parliament should have the primacy when it comes to information on national budgets.

“We should co-ordinate, but I’m very clear that when it comes to national budgets, then, the first people that need to be told are the elected members of the House of Commons, and there’s absolutely no way that can change,” he said as he arrived for the meeting.

The EU ministers will also examine the possibility of more severe sanctions in the event of a country not complying with the stability and growth pact.

That could entail enforced deposits being made by a country if it is seen to be stepping out of line on debt, with money in the bank demanded upfront to cover the country in case of debt difficulties.

Another proposed stricture could be putting in place restrictions on the money a country can receive from the EU in the event of it racking up too much debt.

Separately on Friday, Germany’s lower house of parliament approved its contribution to a 750bn euro ($938bn; £651bn) rescue deal for the eurozone.