German media sees partial victory for Merkel on EU

Fri Oct 29, 2010 8:08am EDT

* Merkel fails to push through voting right suspension

* Brussels deal seen as "lite" solution to problem

By Dave Graham

BERLIN, Oct 29 (Reuters) - German media offered guarded praise for an agreement in Brussels to make limited changes to the EU treaty, describing it as a compromise that bought time to find a lasting remedy to debt woes that have plagued the bloc.

Under pressure from Chancellor Angela Merkel and French President Nicolas Sarkozy, EU leaders in Brussels agreed that changes were needed to create a permanent system to handle sovereign debt problems and endorsed tougher budgetary rules, including sanctions on profligate states. [ID:nLDE69I1FB]

Facing public hostility to a bailout of Greece and the creation of massive rescue fund designed to protect the euro currency, Merkel had insisted on the option of suspending voting rights for budget sinners and alterations to the treaty.

Business daily Handelsblatt said the consensus reached on treaty changes was a significant achievement, calling it a "breakthrough" for Merkel, whose centre-right coalition has suffered a record drop in support in its first year in office.

But Berlin failed to win widespread support for demands to suspend the voting rights of member states which breach the rules. This would have required more radical treaty change, backed by public referendums, and was put on the backburner.

This meant this plan was "pretty much off the table for the time being," wrote daily Frankfurter Allgemeine Zeitung.

As a result, the deal reached in Brussels amounted to "lite solution" to the problem of ensuring budgetary discipline, said German newspaper Hannoversche Allgemeine Zeitung.

In a comment for German public radio, Birgit Schmeitzner said the fact that Merkel had reached one of her two objectives meant there was still something to play for.

"This is a stage victory that Angela Merkel can celebrate," she said. "It helps that Merkel saved face. And that she didn't have to take up her threat of allowing the summit to fail."

Gunther Krichbaum, a member of Merkel's conservative Christian Democrats, who chairs the European Union affairs committee in the lower house of parliament, said the agreement reached amounted to real progress on warding off future crises.

"It is a great step forward because we now have a crisis mechanism so that in the future we will not have to deal with problems like the Greek crisis on an ad hoc basis," he said.

The leaders asked Herman Van Rompuy, the president of the EU Council grouping national governments, to prepare changes to the Lisbon treaty in time for agreement at a summit in December and said he should work on them with the European Commission.

(Additional reporting by Brian Rohan; Editing by Elizabeth Fullerton)

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