Belgium says euro bonds must wait

MILAN: Common euro area bonds must wait until economies and public finances in the bloc have converged, Belgian Prime Minister Yves Leterme told Italian daily La Stampa on Monday.

Italian Economy Minister Giulio Tremonti said on Saturday that joint euro zone debt issuance was the only way to solve the region's debt crisis, adding it was only a matter of time before it was adopted .

But Leterme said some countries would be forced to pay more than others, echoing a position shared by Germany. Berlin believes joint euro bonds would be a disincentive for fiscally undisciplined states to fix their public finances.

"Between sounder and less sound countries, only the first ones would pay," he said.

"I believe that we must make our economies and public finances converge: until then we must shut (the idea of common euro bonds) in a drawer. In the future we should use them to invest in infrastructure," he added.

Leterme also said the European Central Bank was independent and would decide on its own when to stop buying Italian government bonds on the secondary market.

He dismissed the idea of a break up of the euro zone but urged countries to do more saying decisions taken at European Union July 21 summit had yet to be ratified by single members.

"That's not good," he said.

Copyright Reuters, 2011