In brief, timid first steps towards a European unemployment –insurance

On 19 June, and after the Franco-German summit meeting came to a close, the 'Meseberg declaration' was published in which both nations stated they would be examining 'the issue of a European unemployment stabilization fund', which could be mobilized in cases of 'sever economic crisis' and which would work 'without use of transfers' (which effectively means German contributions will not be directly financing stressed southern countries) . Both countries have agreed to put 'a working group in place with a view to making concrete by the European Council meeting of December 2018.' This decision comes after noteworthy proposals from the German Finance Minister, SPD member Olaf Scholz, who at the start of June 2018 was calling for the creation of a European system of unemployment insurance within the Eurozone (c.f. article No. 10725). The Meseberg summit meeting also delivered other more concrete measures that aim to better protect the Eurozone in times of crisis. France and Germany thus announced their willingness to transform the European Stability Mechanism (ESM) into a type of European IMF that would be able to disburse loans to countries hit by crisis. Both nations also agreed on establishing a Eurozone budget by 2021, 'in order to promote competitiveness, convergence, and stability, within the Eurozone.' Leaders Angela Merkel and Emmanuel Macron now have to convince the other 17 Eurozone countries to accept this Franco-German compromise agreement when they meet on 28-29 June at the European Summit in Brussels.