The 25 EU leaders have approved a looser version of budget deficit rules agreed by their finance ministers at the weekend. The revamped Stability Pact will make it easier for countries with excessive budget deficits, such as France and Germany, to avoid sanctions. The leaders also backtracked on a controversial plan to liberalise the market for services.
The two-day summit in Brussels, ending today, comes against a backdrop of sluggish growth across Europe. Wednesday’s talks are supposed to focus on the Lisbon Agenda, agreed at the height of the boom in 2000 and meant to make Europe more competitive than the United States in 2010.The prime minister of Luxembourg, Jean-Claude Juncker, said on Tuesday: “The strategy of Lisbon, which talks about growth, jobs and competitiveness means we have to open up the services sector. But the current draft of the services directive will undergo substantial changes, so that we can allow for the serious, often laudable concerns that have been expressed.” The 25 leaders have now agreed to ask the European Commission to rewrite the so-called Bolkestein directive. French president Jacques Chirac says the bill is unacceptable for his country and others including Germany. Critics believe the plans to liberalise the services sector would result in workers from Eastern Europe coming west, driving down wages and environmental standards. In France, the proposal has fuelled trade union protests and strengthened the “no” camp ahead of the May referendum on the EU constitution.