Main points agreed at crunch EU summit
(BRUSSELS) - EU leaders met in Brussels for a crunch summit considered to be the last chance to save the euro. These are the main points agreed after a first 10-hour round of talks that ended at 5:00am (0400 GMT).
A new "fiscal compact": The euro area leaders agreed in a statement on a "golden rule" to tighten budgetary discipline to prevent a repeat of the debt crisis.
-- The so-called "structural deficit", which strips out one-off effects such as debt repayments and the economic cycle, should be capped at 0.5 percent of gross domestic product (GDP).
-- Tighter rules will be enshrined in participating countries' constitutions, with the European Court of Justice to check they are correctly transposed.
-- "Automatic consequences" for countries whose public deficit exceeds three percent of GDP unless a powerful group of nations blocks it.
-- Countries pledged to "work on how to further deepen fiscal integration so as to better reflect our degree of interdependence" but there was no deal struck on pooling eurozone debt by creating so-called eurobonds.
Firefighting measures: The euro area leaders agreed on several measures they hope will convince markets they have an effective firewall against the crisis spreading throughout the zone.
-- The future bailout fund, or European Stability Mechanism (ESM), will be accelerated, with the objective of bringing it into force by July 2012.
-- Leaders said they would "reassess the adequacy" of the 500-billion-euro limit for the this fund.
-- Member states would "consider, and confirm within 10 days" a transfer of 200 billion euros to the International Monetary Fund which could then come to the aid of debt-mired eurozone countries.
-- The statement said it hoped for "parallel contributions from the international community".
Private sector involvement: Leaders recognised that their previous policy during the crisis in Greece, of forcing private investors to accept losses of their holdings of Greek debt, had backfired and would not be repeated.
These measures would be made legally binding by means of an international agreement "to be signed in March or at an earlier date", the statement said.
The measures will be signed by all 17 eurozone member states, plus Bulgaria, Denmark, Latvia, Lithuania, Poland and Romania. The Czech Republic and Sweden are consulting their parliaments before deciding. Britain and Hungary decided to remain outside.
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