German Chancellor Angela Merkel proposed a new European aid fund to bolster competitiveness as she highlighted disagreements over budget rules, joint borrowing and bank supervision in a pre-summit address.

Speaking to lawmakers in Berlin before heading to Brussels for a two-day gathering of European Union leaders, Merkel laid out her vision for more economic coordination, while expressing “surprise” at negative reaction to a proposal for a watchdog with veto power over national budgets. Her vision includes a fund “limited in time and project-based” and possibly stocked by the proposed financial transaction tax, she said.

“To give all member states the opportunity then to improve their competitiveness and to actually be able to implement these commitments, I propose that we introduce a new element of solidarity,” Merkel said in her speech at the Reichstag parliament building. “Yes, we need solidarity, but we need a form of solidarity that leads to what we need: more competitiveness.”