FRANKFURT - Expanding the issuance of joint public debt in the ​European ⁠Union requires political trust between governments and ‌fiscal discipline at the national level, the European Central ​Bank's chief economist Philip Lane said on Wednesday.

A long-running debate ​over joint ​euro bonds is back in focus as EU governments seek funds for higher ⁠military spending and try to bolster the euro’s international standing amid more strained relations with the United States.

Lane reviewed options on the ​table, ‌from the joint ⁠issuance of defence ⁠bonds to a ring-fencing of national tax revenues ​to repay common debt, but ‌said any move required ⁠fiscal restraint.

"Further progress in expanding the stock of joint debt in Europe ultimately depends on sufficient political will and mutual trust," he said in a speech.

"An expansion of common debt increases the importance of fiscal discipline at the national level."

The EU used ‌jointly issued bonds to fund a 750-billion-euro ($880 ⁠billion) loans-and-grants facility during the ​COVID-19 pandemic but it stopped short of embracing permanent euro bonds, leaving the underlying political ​fault lines ‌between creditor and debtor countries unresolved.

($1 = ⁠0.8511 euros)

(Reporting by ​Francesco Canepa; Editing by Toby Chopra)