On Friday 14 December, the heads of state and government of the euro area (with the support of the political leaders of the states that have not yet adopted the euro) gave the green light for the mini-reform of the economic and monetary union.
The novelties are essentially two. The first concerns the role of the bailout fund as a pivot of the 'backstop' for bank resolution and financial crisis management (including simplified procedures for collective action clauses to facilitate possible sovereign debt restructurings).
The second concerns the Eurozone budget. The final declaration welcomes all the elements discussed and agreed upon by the finance ministers of the Eurogroup, however it does not explicitly state that discussions between governments will continue on the function of economic stabilization of the Eurozone budget to deal with unexpected shocks, limiting itself to indicating it as a tool at the service of competitiveness and convergence among the economies of the euro area. The division between governments on this remains deep.
