The Franco-German accord is likely to pave the way for an agreement in the wider group of euro zone finance ministers who will discuss the set-up of the new but disputed tool next month, ONA reports citing Reuters.
“The purpose of the euro zone budgetary instrument would be to foster competitiveness and convergence in the euro zone...,” the joint Franco-German proposal read, according to the government document seen by Reuters.
The new tool should also be open for countries that are locked into the Exchange Rate Mechanism II - the two-year waiting room for joining the euro, the proposal said.
“As agreed by the summit, the instrument should be part of the EU budget. It would not be credit-based,” it read.