ESCHBORN, Germany (MNI) – The concept of solidarity within the
European Union must not apply only to countries with a top credit
rating, German Finance Minister Wolfgang Schaeuble argued Monday.

Rather all countries must do their part to encourage financial
stability, the minister said at the annual reception of the Deutsche
Boerse stock exchange at its headquarters outside of Frankfurt.

Germany depends on the stability of the euro, Schaeuble stressed:
“Solidarity cannot be limited to six triple-A rated countries. Rather it
applies to all 17, and it begins with the countries that cause the
problems, namely Greece, Ireland and others that won’t be named.”

These countries must pursue difficult but “essential” measures to
consolidate their public finances, he demanded. “We are decisively
dependent on the stability of this shared European currency.”

Schaeuble strongly hinted that Germany would not back an expansion
of the European Financial Stability Facility without the support of all
Eurozone countries.

“We have made it clear … that we are not prepared for an
improvement or an intensification of the standby mechanism if all
partners in the currency union do not make their contribution,” he said.

The German economy recovered much faster than expected last year
with GDP growth of 3.6%, the strongest rise since reunification,
Schaeuble noted.

After the 4.7% plunge in 2009, “we are a little bit below the
pre-crisis level,” he conceded. But there are very good chances of
returning to that level this year. Moreover, there is also a “good
chance” that unemployment will fall below three million, he said.

Given that the government ended 2010 with net new borrowing of just
over E44 billion, it must therefore do better than the official target
of E48 billion called for in this year’s budget, the minister argued,
positing E40 billion as an “upper limit”.

The country must stick to the path of budget consolidation, he
insisted.

–Frankfurt bureau, +49-69-720142, tbuell@marketnews.com

[TOPICS: M$X$$$,MGX$$$,MFX$$$,M$$CR$,M$G$$$,MT$$$$]