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Updated Saturday, December 10, 2011 0:16 am TWN, By Gabriele Steinhauser and Angela Charlton,AP

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All EU nations except Britain open to joining new treaty

BRUSSELS -- The European Union's president said Friday that 26 of its 27 member countries are open to joining a new treaty tying their finances together to solve the euro crisis. Only Britain remains opposed, creating a deep rift in the union.

In marathon overnight talks, the 17 countries that use the euro gradually persuaded the others to consider joining the new treaty they would create. Some of those countries may face parliamentary opposition to the treaty, which would allow for unprecedented oversight of national budgets.

“Except for one, all are considering participation,” EU President Herman Van Rompuy told reporters.

A document released near the end of a high-stakes EU summit Friday said the leaders of nine of the 10 EU countries that don't use the euro “indicated the possibility to take part in this process after consulting their parliaments where appropriate.”

“It's a very good outcome for the euro area, very good,” ECB President Mario Draghi said in Brussels. “It is going to be the basis for much more disciplined economic policy for euro-area members. And certainly it is going to be helpful in the present situation.”

The treaty will constitute unprecedented intervention in national budgets by a central European body.

Participating governments will need to have balanced budgets — which is calculated as a structural deficit no greater than 0.5 percent of gross domestic product — and will have to amend their constitutions to include such a requirement. An unspecified ``automatic correction mechanism'' will punish countries that break the rules.

In addition, countries that run deficits larger than 3 percent will face sanctions.

To prevent such deficits, countries will have to submit their national budgets to the European Commission, which will have the authority to request that they be revised. Countries will also have to report in advance how much they plan to borrow.

Stocks and the euro climbed on the news of the new treaty.

While the deal could help save the euro, the political implications of the rift could be enormous. Germany and France had hoped to persuade all 27 EU countries to agree to change the treaty that governs their union. But Britain, which doesn't use the euro, firmly said no.

Hungary, the Czech Republic and Sweden said they would need to consult their parliaments, while the other six countries outside the eurozone — Denmark, Poland, Bulgaria, Romania, Latvia, Lithuania — agreed they wanted to join.

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