The European Union has agreed to a new fiscal pact that outlines binding debt limitations and gives the EU the power to impose sanctions against member nations that fail to adhere to budgetary and deficit limits, according to Spiegel International.
The pact was signed on Monday, but has garnered further attention in the last two days for the very public objections raised by the U.K. and the Czech Republic to the pact. Both nations refused to give their approval to the measures.
Here are some of the key details surrounding the EU's new fiscal pact and the continuing controversy involving the U.K. and the Czech Republic.
* The pact was informally agreed upon by a majority of the EU member nations back in December.
* The pact was heavily promoted and pushed by German Chancellor Angela Merkel, who was, and remains, its largest proponent.
* The 25 countries that signed the pact still have to send the agreement to their individual parliaments for approval in order for it to become official.
* Merkel and other EU leaders are currently attending the World Economic Forum in Davos, which is where the pact was signed on Monday, according to CNN International.
* The pact is meant to more closely bind together the economies of the 17 member nations that use the euro as a common currency.
* In addition to the fiscal pact, there is also a new EU treaty in the works, due to be ratified in March. All member nations must give their approval for a new treaty to be enacted.
* According to Euronews, the Czech Republic refused to sign the new pact because it contained items that were in conflict with their constitution.
* The Czech Republic did not stand in opposition, however, to a measure that would increase the European Stability Mechanism (ESM) to more than 500 billion euros. The ESM is meant to provide a "firewall" so that smaller economies that are struggling cannot bring larger EU economies down with them.
* British Prime Minister David Cameron had said earlier in the week that the U.K. had no intention of signing the pact, because concessions and considerations that the U.K. had asked for had not been addressed.
* The Telegraph quoted Cameron as saying that fiscal reforms were not the only step necessary in order to provide a solution to the EU's economic instability. He also cited a perceived lack of European competitiveness, as well as a need to open up labor markets and make investing and working with the EU more attractive.
Vanessa Evans is a musician, traveler, and freelance writer with an interest in European studies and events.
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