German Finance Minister: EU Needs Fiscal Union

The European Union needs a "fiscal union" in order to overcome the eurozone debt crisis, Germany's finance minister said on Monday ahead of vital talks in Paris between the German and French leaders.

"A fiscal union has to be created alongside a political union," Wolfgang Schaeuble said during a visit to Hungary.

"It is clear that we have to win back the confidence of financial markets. The dollar had 100 years to stabilize whereas we, in the era of globalization and information technology, don't have so much time with the euro," he said.

"The solution to all these problems is a fiscal union," he said, adding that Germany wanted a "lasting and sustainable solution for the whole continent," not just for the 17 members of the eurozone.

French President Nicolas Sarkozy was due to host German Chancellor Angela Merkel in Paris later Monday to thrash out details of a plan to save the euro ahead of an EU summit starting Thursday.