Merkel and Sarkozy Called for a New European Treaty

The leaders of France and Germany are now calling for a new European treaty that will bind the eurozone countries.

The determination comes following meetings between French President Nicolas Sarkozy and German Chancellor Angela Merkel ahead of a crucial EU summit later this week.

Sarkozy says both he and Merkel want to see unanimous support for a revamped treaty from the whole of the European Union.

(Sarkozy) "Our preference would be for a treaty of all 27 members so that nobody feels excluded from the Franco-German move. But we are perfectly ready to go for a treaty of 17 members open to all countries that would want to join us."

The Franco-German treaty proposal would include automatic sanctions for states that fail to meet the 3 percent deficit rule, as well as a budget-balancing rule across the euro zone.

For her part, German Chancellor Angela Merkel insists the move will help restore confidence in Europe.

(Merkel) "We are in a difficult situation and it's about getting confidence back, it's about being trustworthy, about being able to meet our commitments. We are suffering from the events. Many are asking themselves if we can be trusted. So during the EU summit on Thursday and Friday, we have to recover a portion of that confidence."

Their proposals are being sent to the other EU leaders ahead of a pan-European summit in Brussels later this week.