EU leaders hail banks breakthrough

Prime Minister David Cameron said changes in the eurozone gave Britain the opportunity to get a 'better deal' for Britain

Prime Minister David Cameron during a round table meeting at an EU summit in Brussels (AP)

First published in National News © by

EU leaders will hail a breakthrough in efforts to deepen eurozone integration and restore stability to the 17-nation single currency club.

But moves at a summit in Brussels to set out a timetable for a range of comprehensive checks and balances on eurozone banks also raise new questions about a "them and us" two-speed Europe. British banks will not to subject to the new centralised scrutiny, continuing to be supervised by national authorities.

Prime Minister David Cameron acknowledged at the summit on Wednesday that the tighter eurozone relationship will be an opportunity for the Government to draw up a new "settlement" for the UK in Europe - built around reinforcing the single market, rather than the single currency.

But most of the other nine non-eurozone states are considering whether to submit their banks to the new economic crackdown, if only to benefit from any resulting boost in confidence for their single currency neighbours. Only the UK and Denmark have formal opt-outs from joining the euro.

Before leaders return to their capitals on Thursday afternoon, a summit declaration is expected to set a loose timetable for what Brussels is calling "genuine economic and monetary union".

The absence of knee-jerk market responses to the latest medicine the eurozone is trying to administer has raised hopes that a recovery can be forged in calmer conditions, coupled with new moves for jobs and growth. Mr Cameron is happy to endorse the new eurozone revival roadmap following guarantees that they will not affect the UK.

He said: "Britain's not in the euro, we're not going to join the euro so we won't be part of that integration, but this change taking place does give us the opportunities to argue for the things that we want in Europe and get a better deal for Britain in Europe. That's what I'm interested in discussing and pursuing for Britain."

Meanwhile European Commission president Jose Manuel Barroso - who repeated calls this week for EU political union - told eurozone leaders on Wednesday to keep up momentum towards full banking union.

"The fact that the situation in the financial markets is now better than before should not be seen by the governments as a way to procrastinate. I hope they keep the same sense of urgency."

He added: "We are entering into more delicate issues, in terms of pooling of sovereignty in some areas, in terms of fiscal matters. But I think it is possible to achieve progress."

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