Spain, Italy say they don’t need bond program’s assistance

MADRID — The leaders of Spain and Italy insisted Monday that neither country had near-term plans to invoke the bond-buying program that the European Central Bank had offered, nor to support a recent proposal for a supercommissioner who might intervene in national budgets.

Instead, both the Spanish prime minister, Mariano Rajoy, and his Italian counterpart, Mario Monti, said they would continue to push for rapid adoption of a European fiscal and banking union.

“With regard to the European agenda, Spain and Italy are more united than ever,’’ Rajoy said at a joint news conference with Monti.


Rajoy has been under pressure to tap a bond-buying program announced by Mario Draghi, the ECB’s president, in early September. But he has refused to leap at the opportunity, and on Monday he said that Madrid would ask for such funding only when he felt it was ‘‘convenient’’ to do so.

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Monti also dismissed the idea that Italy would need such help to meet its immediate refinancing obligations.

Neither leader is eager to expose his government’s finances to the greater European scrutiny that requesting the aid would entail.

The Madrid meeting came shortly after Draghi endorsed a proposal initially made by Wolfgang Schauble, Germany’s finance minister, to establish a European monetary and economic affairs commissioner.

That person would have the power to intervene in national budgets if eurozone governments broke deficit rules.


Creating such a post would require the approval of all 17 member countries of the euro currency union.

“If we want to restore confidence in the eurozone, countries will have to transfer part of their sovereignty to the ­European level,’’ Draghi said last week during an interview with the German magazine Der Spiegel.

Rajoy and Monti discussed the supercommissioner proposal Monday, but neither offered support for the idea.

They warned that it could further confuse investors about the course of policy making in the eurozone.

‘‘There is a limit to the signals that can be given to the markets in terms of fiscal virtue,’’ Monti said.


‘‘The markets could see this as meaning that the existing instruments don’t work.’’

The Rajoy-Monti show of unity underlines the extent to which Madrid and Rome face the same challenges in persuading investors to buy their debt at a sustainable borrowing cost.

Monti argued that the difference between the interest rates of German and Italian government bonds, albeit less than before the ECB’s bond-buying offer, remained ‘‘higher than what is justified’’ by economic fundamentals.

Rajoy went a step further.

“We cannot live in a European Union where some countries get financing for free and others for a lot more,’’ he said.

But for now, Rajoy also has his own struggles, including an unemployment rate in Spain of 25 percent and a separatist drive in Catalonia, the country’s most powerful economic region.

Asked about the political tensions with Catalonia, Rajoy insisted Monday that ‘‘we will overcome this situation through dialogue and by applying the law.’’