skip to main content

Significant roadblock to EU debt agreement

Nicolas Sarkozy to seek a breakthrough in the talks
Nicolas Sarkozy to seek a breakthrough in the talks

It has emerged that a significant roadblock stands in the way of EU leaders finally resolving the euro zone debt crisis at a summit in Brussels on Sunday.

French President Nicolas Sarkozy has said that Paris and Berlin disagree over whether the European Central Bank should financially support the EU's new bailout fund.

France wants to increase the firepower of the fund by involving the ECB, however Germany is opposed to the move, as is the union’s central bank itself.

Mr Sarkozy travelled to Frankfurt tonight where he held talks with Angela Merkel, other euro zone policy chiefs and the head of International Monetary Fund, Christine Lagarde.

The French leader's attentions may be somewhat divided, however, as reports suggest that his wife Carla Bruni-Sarkozy had given birth to the couple's first child.

No public statement was made after the meeting, held at the margins of a farewell for ECB President Jean-Claude Trichet.

Intense negotiations can be expected right-up to the summit on Sunday.

The European Commission says the euro zone's credibility is on the line and it is going to insist that a comprehensive deal to the debt crisis is secured.

Earlier, European Commission President Jose-Manuel Barroso said he will insist on decisive action from EU leaders at Sunday's summit on tackling the debt crisis.

He told journalists at a news briefing that work was continuing on fleshing out proposals on recapitalising banks, the enhanced bailout fund and on a writedown of Greek debt.