EU leaders struggle to rewrite treaty, save single currency

AMSTERDAM, June 16: European leaders, fighting to salvage plans for a single currency and to prepare the European Union for expansion, open...

AMSTERDAM, June 16: European leaders, fighting to salvage plans for a single currency and to prepare the European Union for expansion, open what could be a bruising summit on Monday with the future of the Union at stake.

The most pressing item on the agenda is keeping the Euro, as the new currency will be called, on track for launch in 1999. To do that, the summit must deal with France’s new socialist-led government, which suddenly has objections. France casts doubts on a German-inspired deal known as the Stability Pact. That agreement imposes penalties on countries that meet the criteria for adopting

the Euro, then backslide through excessive public spending.

France, with 12.8 per cent unemployment, says it won’t go along with the pact unless it is linked to an EU effort to create jobs.

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“The stability pact is not up for discussion,” insisted German Finance Minister Theo Waigel. “Massive spending won’t help,” Ruairi Quinn, Ireland’s Finance Minister, said on Sunday night. But he added: We have to hear what the French have to say.”

After a three-hour dinner meeting on Sunday night, EU finance ministers said they were close to a deal with the French.

“I’m very glad that I can say tonight we made extremely good progress,” said Finance Minister Gerrit Zalm of the Netherlands, which currently holds the EU presidency. “My expectation is tomorrow we will be able to finish a text acceptable to every country.” More generally, the presidents and prime ministers meeting in the headquarters of the Dutch Central Bank are trying to conclude an ambitious rewriting of the EU’s treaty.