FRANKFURT (MNI) - Belgian Prime Minister Yves Leterme appealed in a guest column Friday for a EU debt agency or a finance ministry.

Writing in Germany's Financial Times Deutschland, Leterme noted that the most recent market tensions pointed to the problems that a currency union has without shared "economic governance."

"Because a full-fledged economic governance was not doable at the start of the Eurozone, we agreed to the Stability and Growth Pact as a preliminary solution," he explained.

"I propose to go a step further and found a common finance ministry or a European debt agency for the Eurozone," he said.

Leterme's proposed European Debt Agency would be an EU institution that would handle emissions and administration of government debts in the Eurozone. It "would be subordinate to the finance ministries in the Eurogroup," he added.

The creation of such an agency would have "multiple advantages," Leterme pointed out. For one thing, "the EDA would be an instrument for better implementation of the Stability and Growth Pact."

"After agreeing on a deficit goal for a member state in the Eurogroup and the European Council, the EDA would borrow in the amount of the agreed deficit," he explained.

But, if a country were not able to meet its obligations under the Stability Pact, it could "face the frightening task of acquiring additional funds from the capital market", where it would have to pay higher interest rates.

Leterme conceded that "not all member states of the Eurozone, and also not all states that are not members, would have the same enthusiasm for the concept," since the EDA would mean transferring national powers to a community institution.

He also admitted that the EDA contradicts the "no bail-out" clause of the Maastricht Treaty and acknowledged that financial markets could essentially do the same job as an EDA in keeping states fiscally in line.

But, "it would be better to control this process and use the EDA to implement the stability program," he concluded.