Compromise in Amsterdam

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AMSTERDAM, Netherlands: The crisis that threatened the launch of Europe's common currency was defused late Monday after EU leaders reached a compromise deal that meets Germany's concerns for a stable euro and French demands for job creation. The agreement will free up hundreds of millions of dollars for job-creating strategies, giving priority to small and mid-sized companies. But for France, there will be no free lunch. Addressing German concerns, Dutch Finance Minister Gerrit Zalm warned that the funds must be paid back in full. "There is no suggestion lots of subsidies will be handed out," he said. Nonetheless, the deal seemed to be a step in the right direction for France's new Socialist Government, which has stressed that the alliance focus on unemployment rather than deficit reduction. But the compromise only went so far. While France was able to pry some concessions from the talks, Germany's position on strict budgetary guidelines was entrenched after it was agreed that member nations which run up large budget deficits will be subject to punitive fines. But with Germany's unemployment the highest it has been since World War II, there is considerable speculation that even it may be forced to eventually advocate a looser interpretation of the guidelines governing deficit reduction.