French President Francois Hollande on Thursday called for the eurozone to adopt bold new mechanisms to insulate member states and their banks from market turmoil, such as a joint fund to pay down debt, putting him on a collision course with Berlin.
After a meeting with Italian Prime Minister Mario Monti in Rome, Hollande said he would urge EU leaders at a summit at the end of the month to adopt a series of measures to strengthen economic growth and financial stability in the eurozone and deepen economic integration.
Hollande said he had submitted details of his proposals to European Council President Herman Van Rompuy.
Photo: Reuters
“We need imagination and creativity to find new financial instruments,” Hollande told a joint news conference with Monti.
“To deepen financial union, there are many options such as a financial transactions tax and joint debt issuance, including euro bonds, euro bills or a debt redemption fund,” he said.
The French leader, who took office last month calling for a change of direction in Europe away from German-inspired austerity, urged closer cooperation between member states on financial regulation to break the link between struggling eurozone states and their weakened banking systems.
He called for the bloc’s European Stability Mechanism, a permanent rescue fund that is due to start operation next month, to be given a banking license to allow it to borrow money from the European Central Bank to bolster its firepower.
Hollande’s bold proposals appeared to place him at odds with German Chancellor Angela Merkel, who on Thursday rebuffed pressure for Europe’s largest economy to underwrite debt or guarantee bank deposits in the eurozone, despite soaring borrowing costs in Italy and Spain.
Hollande has long advocated a growth pact for Europe including a financial transactions tax and joint bonds to finance infrastructure projects, more lending by the European Investment Bank (EIB) and more effective use of structural funds.
Hollande is due to present his a position at a four-way meeting with Monti, Merkel and Spanish Prime Minister Mariano Rajoy on Friday next week — a week ahead of the summit — and is hoping to make progress towards a consensus.
“The aim of June 22 is to have a four-way contribution and an agreement between at least two parties on a joint position. A four-way agreement would be fantastic,” a French source said.
France believes at least 100 billion euros, preferably more, are needed in structural funds, project bonds and new capital for the EIB, the source said.
The source also said there was no deadlock between Germany and France on the issue of mutualized debt in the form of euro bonds, which France wants to be implemented in the next few years.
Monti, whose government has found itself in the market’s sights despite undertaking reforms, voiced support for Hollande’s growth agenda and said bolder steps toward integration were required in Europe.
“We both agreed that the progressive improvements made to eurozone governance are not enough to shield the euro from market turbulence,” he told the news conference.
“We discussed some proposals for common bonds and we were very much in agreement on the need to increase investments that are productive for the economy — from the private sector, from the public sector and from private-public partnerships,” he said.
Three days ahead of Greece’s elections, Monti said that both he and Hollande wanted the country to remain in the eurozone.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
MAJOR BENEFICIARY: The company benefits from TSMC’s advanced packaging scarcity, given robust demand for Nvidia AI chips, analysts said ASE Technology Holding Co (ASE, 日月光投控), the world’s biggest chip packaging and testing service provider, yesterday said it is raising its equipment capital expenditure budget by 10 percent this year to expand leading-edge and advanced packing and testing capacity amid strong artificial intelligence (AI) and high-performance computing chip demand. This is on top of the 40 to 50 percent annual increase in its capital spending budget to more than the US$1.7 billion to announced in February. About half of the equipment capital expenditure would be spent on leading-edge and advanced packaging and testing technology, the company said. ASE is considered by analysts