European leaders appear increasingly out of step ahead of yet another crucial summit on the eurozone crisis.
Germany’s Chancellor Angela Merkel’s “not in my lifetime” opposition to euro bonds puts her at odds with France’s President Francois Hollande. His “more growth less austerity” stance is backed by the Italian and Spanish prime ministers, Mario Monti and Mariano Rajoy.
But at the end of the day they are all aware it is Berlin that holds the purse strings and therefore the cards.
The two-day summit beginning on Thursday is expected to announce a growth pact of 130 billion euros. But that consists almost entirely of sums already pledged to structural funds and the European Investment Bank.
For Spain, which has seen borrowing costs spiral in recent weeks, there is now an urgent need for more solidarity.
In Madrid the prime minister did not mince his words before parliament ahead of the summit. “We can’t keep funding ourselves at this rate for much longer,” Rajoy said.
Spain has had to seek loans of up to 100 billion euros to recapitalise its crumbling banking sector. But like Italy it says it is already doing all it can to cut debt mountains and now needs more support from its eurozone partners to keep the markets at bay.