Treaty change must be for all EU: Danish PM

BRUSSELS Thu Dec 8, 2011 3:45pm EST

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BRUSSELS (Reuters) - Denmark is prepared to back EU treaty change if it helps resolve the euro zone debt crisis, but everyone will have to compromise and all 27 EU countries need to be on board for it to succeed, Prime Minister Helle Thorning-Schmidt said on Thursday.

With Denmark taking over the EU's rotating presidency for six months from January 1, Thorning-Schmidt said she was sharply conscious of the responsibility Denmark faced in tackling the region's problems, despite being outside the euro zone.

While she has an ambitious agenda that ranges from energy policy to telecoms regulation and securing the EU's external borders, she acknowledged that treaty change and the economic crisis were likely to dominate the presidency.

"We have not always been convinced that treaty change was the right path because it tends to take a very long time," she told Reuters in an interview, shortly before EU leaders began a summit to discuss ways of resolving the debt crisis.

"But the Danish government is now seeing treaty change as perhaps part of the solution to this problem and the lack of discipline within the euro zone, and therefore we come with a very open mind.

"I want to urge the other member states to be flexible in seeking a compromise... and to do their utmost to keep the 27 member states together. It's very important that, at a time of crisis, we stick to the 27 member states."

Germany and France are pushing to change the EU treaty to tighten budget deficit and debt rules for the 17 euro zone countries in the hope of better insulating the currency area from the debt crisis.

But there is not universal backing for the move, with several euro zone and non-euro zone countries wary of opening up the EU treaty, which took eight years to negotiate and only came into force two years ago.

There is also concern that getting enveloped in the process of changing the Lisbon treaty -- which could take up to two years, depending the procedure used -- is a distraction from the immediate demands of resolving the problems in Italy, Spain, Greece and elsewhere, with market pressures unrelenting.

IMF SUPPORT

Thorning-Schmidt said that as well as working towards treaty change, it was essential for the euro zone and the broader EU to put a proper firewall in place to defend against market pressures, and said Denmark would be willing to contribute funds to the International Monetary Fund (IMF) to help bolster its ability to tackle the crisis.

"Just yesterday we made it clear to our central bank that we would be supporting that," she said, when asked if Denmark would be prepared to provide money from its central bank to the IMF.

EU officials have said that euro zone central banks could provide about 150 billion euros to the IMF, with a further 50 billion possibly coming from the 10 non-euro zone EU countries.

Thorning-Schmidt said the Danish central bank was prepared to provide 40 billion Danish crowns (5.4 billion euros), if asked to contribute funds.

She described the IMF support as part of a series of steps to build a stronger firewall, with a strengthening of the euro zone's temporary bailout fund, the EFSF, also critical alongside moves to bring forward the introduction of the permanent bailout fund, the ESM, to July 2012, from July 2013.

"We are in such a dire crisis that we need to take firm action and this is what I hope we will do over the next two days," she said of the summit. "We owe it to the citizens to be able to take those decisions."

With the Danish EU presidency less than a month away, she said Denmark was focused on ensuring it could play a constructive role.

"We feel a big sense of responsibility and we will live up to that responsibility. The treaty change issue has come in and I don't think it's going to go away in the next six months, so it's something that we're going to have to deal with and we will deal with it."

But she listed negotiations over the EU's long-term budget, energy policy, green growth, the single market and asylum and border security as other critical issues on the agenda that she intended to tackle.

"We will deal with treaty changes if that is coming our way, but we will also try to take some concrete, solid decisions for Europe that brings us forward.

"It's very, very important that we don't let ourselves get bogged down in crisis management and treaty changes, but also take some concrete decisions."

(1 euro = 7.43 Danish crowns)

(Reporting and writing by Luke Baker; editing by Rex Merrifield)

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