Van Rompuy to head “economic government”?

The German Chancellor Angela Merkel and the French President Nicolas Sarkozy have put forward the name of Herman Van Rompuy to head a new “economic government” for the Eurozone. The leaders of the two biggest Eurozone countries said that the Permanent Chairman of the European Council Herman Van Rompuy is the right man watch over the economic well-being of the Eurozone at a press conference after the Franco-German summit in Paris on Tuesday.

The fact that France and Germany are now in favour of what is described as an economic government for the Eurozone is an about turn in the attitude of the two biggest Eurozone countries on the issue.

Up until a few years ago, even the idea of regular meetings of the leaders of the Eurozone countries to discuss monetary policy met with stiff opposition from amongst others Germany.

The credit crisis and the debt crisis that followed have served to brush away theses taboos. Mr Van Rompuy has chaired already a number of meetings of the 17 Eurozone countries.

Chancellor Merkel and President Sarkozy will write to Mr Van Rompuy today outlining their proposals.

The former Belgian Prime Minister would serve a two and a half year term.

The so-called “economic government” would be made up of the heads of government and heads of state of the 17 Eurozone countries. They would meet twice a year and would be charged with harmonising economic policy in the Eurozone countries.

“This is no economic government for the Eurozone.”

The leader of the liberal group in the European Parliament, the Fleming Guy Verhofstadt (photo), is unimpressed with the Franco-German proposals. Speaking on VRT Radio 1’s morning news and current affairs programme ‘De Ochtend’, that Chancellor Merkel and President Sarkozy’s idea is nothing more than window dressing.

"What they’re proposing is an extra body made-up of heads of government that’s meats a couple of times a year.This is in fact something that they already do”, Mr Verhofstadt said.