Finance ministers of the euro area have agreed to bring the total response capability for emergency funds to some 800 billion euros, said Friday the Austrian Minister of Finance Maria Fekter.
After intense discussions, in the opinion of several sources, the 17 euro zone countries have chosen a minimal agreement that suits countries like Germany, Finland and the Netherlands, which the public does not want to pay for bailouts, sources said the European Union.
This includes $ 500 billion of the European Stability Mechanism (MES), the permanent emergency fund that will be operational in July, and 200 billion already committed by the Europe Fund in financial stability (EFSF), the temporary emergency fund to be disabled in July 2013, told reporters Maria Fekter.
She said that this was added the remaining 49 billion of European Financial Stability Mechanism (EFSM), which had been the first response to the debt crisis of the euro area, and 53 billion bilateral loan to Greece.
A senior official of the euro area has confirmed these amounts.
The EFSF has a total capacity of loan of 440 billion euros and 240 billion would not mobilized a mattress in an emergency within 15 months, during which the EFSF and MES will be operational in parallel, said Maria Fekter.
The European Commission, France and several other major economic powers wanted to help build the capacity of the euro area as possible in the hope that, faced with such a display of force , markets regain confidence in the long run, thus avoiding having to commit any such capacity.
But Berlin did not want such a mobilization in advance, not accepting that if it is really necessary, while noting that the markets were already over and placated implementation of agreed reforms was more important.
With such a decision, the euro area will have something to present to the G20 finance ministers in Washington in April, during a meeting that will discuss higher global contributions to the International Monetary Fund.
Capacity building of the eurozone bailout is, for most countries of the Group of Twenty (G20), a prerequisite for increased allocations to the IMF.
From this perspective, the euro area is now well placed to discuss the matter, said Friday French Finance Minister Baroin.
"This is a good signal," he has said.
Recent Comments