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EU summit agrees to further crisis strategy

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After 10 hours of negotiations, European Union leaders have agreed on establishing a new "fiscal compact" based on inter-governmental treaties to reform the way governments control their finances. The summit in Brussels also decided to launch a permanent bailout fund a year earlier than planned.

The latest EU summit failed to get everyone on board to back a change in the EU treaty that would tighten fiscal coordination.



After 10 hours of negotiations, European Union leaders have agreed on establishing a new "fiscal compact" based on inter-governmental treaties to reform the way governments control their finances.



Instead, EU leaders agreed on establishing a new "fiscal compact" based on inter-governmental treaties. The new accord will include 17 eurozone members plus 6 other non-eurozone EU countries.

Herman Van Rompuy, European Council President, said, "It means we all commit to a new European strong fiscal rule. It means member states will transpose it into their constitution or equivalent. It means reinforcing our rules on excessive deficit procedure by making them more automatic. It also means that member states will have to submit their draft budgetary plans to the commission."

But some countries like Britain are fearing the accord is not in their interest, and have opted to stay out.

David Cameron, British Prime Minister, said, "This new round of integration and special powers and surrenders of sovereignty for European countries and others that want to join the euro, they will be carried on outside the European Union treaty. So we will not be presenting this new treaty, when it’s agreed, to our parliament. It will not involve Britain."

French President Nicolas Sarkozy blames Britain for the refusal, and for proposing its exemption from certain financial regulations.

Nicolas Sarkozy, French President, said, "David Cameron asked for what we all considered unacceptable: a protocol, within the treaty, allowing to exonerate the United Kingdom of a certain amount of regulation regarding financial services.

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