Two key decisions

Two decisions of considerable importance to the European Union and its euro zone will be taken tomorrow. In Germany the powerful Constitutional Court will rule on whether membership of the European Stability Mechanism (ESM), which provides bailouts to member states in trouble, is legal under the German constitution. If the ruling is negative Chancellor Merkel's steadfast support for the ESM may be threatened; to reverse such a ruling would require a two-thirds majority in the German parliament and possibly also a referendum. With elections in the offing, uncertainty could prevail for years; fortunately, informed predictions think that a positive response from the Court is likely.

The second decision tomorrow will be made by Dutch voters in a general election, although its outcome will not be known for some time because complex negotiations to form a coalition will almost certainly be required. The departing centre-right coalition government was pro-EU and supportive of German policies but most observers think that the mood has changed as austerity takes effect in the Netherlands and opposition to financial support for the euro zone's southern states is growing. Eighteen parties will seek votes tomorrow and it is difficult to predict the outcome. However, in Brussels and EU capitals this vote is being seen as a bellwether ballot since Dutch opinion has often in the past been a guide to trends elsewhere in the EU.