The prospect of Stability Bonds could potentially alleviate the current sovereign debt crisis, as the high-yield Member States could benefit from the stronger creditworthiness of the low-yield Member States. Even if the introduction of Stability Bonds could take some time (see Section 2), prior agreement on common issuance could have an impact on market expectations and thereby lower average and marginal funding costs for those Member States currently facing funding pressures. However, for any such effect to be durable, a roadmap towards common bonds would have to be accompanied by parallel commitments to stronger economic governance, which would guarantee.
