Germany wants EU convention to forge new treaty: paper

BERLIN (Reuters) - German Chancellor Angela Merkel wants an EU 'convention' to draw up a new treaty for closer European political unification to help overcome the bloc's sovereign debt crisis, weekly Der Spiegel said on Sunday.

Germany, the European Union's biggest economy, has long argued for more national competences, including over budgets, to be transferred to European institutions but faces strong resistance from other member states.

Merkel hopes a summit of EU leaders in December can agree a concrete date for the start of the convention on a new treaty, Spiegel said.

The idea, which Spiegel said Merkel's European affairs adviser floated at meetings in Brussels, recalls the 100-plus strong convention of EU lawmakers set up in 2001 - inspired by the Philadelphia Convention that led to the adoption of the U.S. federal constitution - charged with the task of preparing a European constitution.

The charter that finally emerged was rejected by French and Dutch voters in 2005 and it became instead the basis of the EU's Lisbon Treaty which is still in force today.

Many member states, recalling the lengthy disputes and setbacks that preceded the Lisbon treaty's entry into force, are reluctant to embark on another prolonged process of institutional reform.

Some countries such as Ireland would have to hold a referendum on any new treaty and the process would increase pressure in Britain - where opposition to closer EU political union runs high - for a complete withdrawal from the EU.

However, Germany believes a much closer fiscal and political union - with EU oversight of national budgets - is needed to ensure that member states get their public finances fully in order and to restore stability to the euro currency.

(Reporting by Gareth Jones; editing by Patrick Graham)