Poland demands EU-wide economic governance

(BRUSSELS) - Poland on Wednesday insisted that new cross-border economic governance arising out of Europe's debt crisis must not be limited to a eurozone "elite."

"As a country that is aspiring to join the eurozone, we would like the eurozone to be a leader but not an exclusive elite within the European Union," said Polish Prime Minister Donald Tusk.

He was speaking, through an English interpreter, eight days before a summit of the 27 European Union leaders at which the issue will be addressed.

Eastern European powerhouse Poland is the EU's fastest-growing economy and the only member to post growth during worldwide recession last year.

Tusk is siding with Europe's biggest power, Germany, in an increasingly bitter debate.

His remarks therefore set up an intriguing clash with France, which wants a permanent eurozone staff to run policy coordination, and Britain, which is adamant that all measures introduced apply only to the 16 -- soon to be 17 -- eurozone countries.

Opposing views on the issue lay partly behind the abrupt postponement of a planned bilateral summit between German Chancellor Angela Merkel and French President Nicolas Sarkozy this week until closer to the summit.

"We support a strengthened economic governance in Europe (because...) we believe in the power of the internal market," Tusk stressed.

European Commission chief Jose Manuel Barroso, whose executive wants to see a range of changes implemented across all 27 member states, said the vexed question of how to better coordinate economic policies across frontiers was a defining moment for the bloc.

"Either we advance and we secure the real project of ... economic governance," he said, "or there could be a risk of going backwards."

Poland takes the chair of the EU on crucial economic and other policy matters in the summer of 2011.

Barroso said Warsaw's programme placed a heavy emphasis on stronger economic governance, which echoed his commission's desire to "avoid a division of Europe."

He added: "It is true that the eurozone member states have additional responsabilities (to each other)," given shared currency interests on top of the free market access that runs throughout the EU.

He said certain "specificities" had already been taken into account in the design of a 440-billion-euro fund of loan guarantees put up by eurozone states to help partners struggling with debts.

But he said that economic governance "can be achieved in the framework of respect for the integrity of the EU."

The commission is funded, and staffed, by all 27 member states and Barroso has already resisted the French drive for institutional change.

On Tuesday, Britain categorically rejected a claim by EU president Herman Van Rompuy that it had agreed to let Brussels pre-vet its budgets before its domestic parliaments.

Van Rompuy chairs a "task force" drawing up new rules for governance. He visits Merkel on Thursday before submitting his first report to next week's summit.

Britain's new government's coalition pact says that any transfer of powers to Brussels would require to be passed in a referendum.