German election puts Europe's ambitions on ice

thenews 2013.06.25 06:23

For the best part of a year, the minds of European policymakers have focused on one overriding issue - banking union.

By establishing stricter oversight of Europe's banking sector and a unified system for dealing with any problems, they hope to draw a line under more than three years of debt and economic turmoil by separating countries from their banks.

For months, a summit of EU leaders on June 27-28 was flagged by officials as an important 'landmark' on the road towards a fully fledged banking union. But it now looks more likely to produce a letdown than a breakthrough.

There are unlikely to be any significant decisions given upcoming German elections, continued disagreement over how banking problems should best be resolved and the fact that financial markets are no longer exerting the same pressure.