Wednesday 20 September 2017

Merkel tests German patience with deal as Spain protests at austerity

Civil servants shout slogans as they hold placards during a protest over government austerity measures in central Madrid yesterday. The placards read, 'This is a hold-up'.
Civil servants shout slogans as they hold placards during a protest over government austerity measures in central Madrid yesterday. The placards read, 'This is a hold-up'.

Stephen Brown and Annika Breidthardt

GERMAN Chancellor Angela Merkel appears to be reaching the limits of German patience on the eurozone crisis, with the Constitutional Court and members of her own coalition seeking deeper scrutiny of whether emergency measures comply fully with national law.

The Constitutional Court said yesterday it would keep Europe waiting for nearly two more months before announcing on September 12 whether Germany can legally ratify Europe's permanent bailout scheme and the fiscal pact for budget discipline.

More immediately, Ms Merkel faces growing dissent in her own centre-right coalition about concessions she made at the last European Union summit, permitting direct help for Spanish banks, which the Bundestag will vote on this week.

Ms Merkel, who still enjoys a high level of support in Germany, is not expected to fall at either hurdle, but both may send signals that she will not be cut any more slack.

Constitutional experts see the court approving the European Stability Mechanism (ESM) and fiscal pact, albeit with warnings, while parliament's approval of Spain's banking bailout on Thursday requires only a simple majority.

Germans are already voicing frustration about the debt crisis and the financial and political demands it is making on Europe's largest economy.

Court president Andreas Vosskuhle said in last week's public hearing that the court might opt for a "very thorough summary review", which could take up to three months.

"It's not great news as it just increases the uncertainty and effectively prevents the ESM from being where it should be," said Lloyds Bank strategist Eric Wand. (Reuters)

Irish Independent

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