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German calls for liquidation procedure

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"There must be consequences and these sanctions must be automatic starting with reductions in EU money received from structural funds before then withdrawing voting rights in EU organs. And I believe there should be an orderly insolvency procedure introduced into European treaties," Philipp Roesler said.

Speaking to his Free Democrats at a party congress in Frankfurt, Roesler also said that the FDP would prevent the introduction of a transfer union and mutually backed euro bonds.

He added that it would be worrying if the European Central Bank were to engage in large-scale bond buying against the advice of the Bundesbank. The newly expanded euro zone bailout fund should prevent "this absurdity" he said.

Copyright Reuters, 2011