Merkel and Sarkozy to unveil eurozone rescue package

The Sunday Times reported that new measures to be set out by Mrs Merkel and Mr Sarkozy in Paris tomorrow will not require changes to European Union treaties, according to diplomatic sources.

However, Mrs Merkel last week vowed to create a "fiscal union" and signalled an uncompromising push for treaty changes when all of the EU's leaders meet this coming Friday.

She made it clear that eurozone states would be called upon to relinquish economic sovereignty and be subjected to close central supervision – a pre-requisite for the eurozone to secure vital extra financial help.

"We are going to Brussels with the goal of achieving treaty change," she said.

Mr Sarkozy has used more moderate language because the French public does not support the idea of handing over tax and spending powers to central EU control, but he did call for a "true economic government" in the eurozone.

http://www.telegraph.co.uk/finance/financialcrisis/8933914/Merkel-and-Sarkozy-to-unveil-eurozone-rescue-package.html